Oil heads for worst close of the year

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Brent crude, the international oil benchmark, was on track for its biggest loss of the year so far on Thursday, as traders weighed the risks from a US-China trade war and rising inventories in the US.

Brent was down 4.6 per cent in mid-afternoon trading in London to $67.75 a barrel, having dropped through the $70 a barrel mark earlier in the day. US marker West Texas Intermediate lost 5.2 per cent to trade at $58.22 a barrel.

The sell-off weighed on oil companies traded in London, with BP and Royal Dutch Shell both losing 3 per cent, while midsized oil and gas explorers were some of the biggest fallers on the FTSE All-Share index.

The index tracking oil and gas companies on the FTSE 350 was down 3 per cent. Premier Oil fell more than 12 per cent, Genel Energy lost 8.5 per cent, while Tullow was down 7.5 per cent.

Oil’s slide comes despite mounting geopolitical tensions in the Middle East, with traders instead preoccupied with the fallout from the US-China trade war and its potential impact on oil demand growth.

Physical supplies of crude are seen as relatively tight due to US sanctions on Iran and Venezuela, and Opec-led production cuts, but stockpiles have been rising in the US, the world’s largest oil consumer and the heart of the shale boom.

Crude inventories in the US hit the highest level in two years last week, the US Energy Information Administration said on Wednesday.

The perceived risk of holding the debt of junk-rated issuers in the US energy industry picked up on Wednesday, according to data from Intercontinental Exchange and Bank of America Merrill Lynch. The gap in yield between a basket of bonds tracking companies in the sector and highly rated government … Read More...

Oil Jumps as OPEC signals continued cuts and U.S. threatens Iran

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Oil started the week strongly after Saudi Arabia and other OPEC+ members signaled their intention to keep supplies constrained for the rest of the year, while U.S. tensions with Iran ratcheted up as President Donald Trump threatened the country in a tweet.

Futures in New York opened by as much as 1.7%, higher following a 1.8% gain last week. Saudi energy minister Khalid Al-Falih urged members of the alliance meeting in Jeddah to “stay the course” on output cuts.

The rising tension was further stoked on Sunday after President Donald Trump tweeted “If Iran wants to fight, that will be the official end of Iran.”

Oil has rallied about 40% this year as supply cuts have outweighed concerns about slowing demand growth caused by trade tensions between the U.S. and China.

 Saudi Arabia and fellow oil producers have to balance their desire to maintain high crude prices with the need to fill any supply gaps caused by rising geopolitical risks in the Middle East and disruptions in Venezuela, Libya and Iran.

“Crude prices are rising because investors view OPEC wants to tighten supply and demand to maintain current prices,” Takayuki Nogami, the chief economist at Japan Oil, Gas and Metals National Corp. in Tokyo., said by phone.

“While the outcome of the OPEC+ meeting was in line with expectations, it’s still uncertain” what the producers will ultimately decide on production cuts in June, Nogami said.

West Texas Intermediate crude for June delivery rose as much as $1.05 to $63.81 a barrel on the New York Mercantile Exchange and traded at $63.53 at 3:04 p.m. in Singapore.

The contract added 1.8% last week, the biggest weekly increase since early April. The contract expires after end of trading Tuesday. The more actively traded July contract rose to … Read More...

OPEC: Nigeria’s April oil production increases by 92,000 bpd to 1.81 million bpd

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Despite internal production crises, global efforts to curb oil glut and bolster crude prices, latest report from Organisation of Petroleum Exporting Countries (OPEC) reveals Nigeria’s records the second biggest oil production increase by 92,000 bpd in April to 1.8 million bpd.

According to independent sources, the 14-member OPEC said Nigeria’s crude oil production increased from 1.72 million bpd recorded in March to 1.81 million bpd in April 2019 by 92,000 bpd.

Since 2018 and first Quarter 2019, Nigeria oil production has being hovering round 1.7 million bpd compare to 1.6 million in 2016.

 

DIPO OLADEHINDE

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Niger Delta crisis threatens Nigeria’s oil revenue amid rally

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Despite rallying crude oil prices, Africa’s biggest oil producing country looks set to suffer a decline in oil revenue, no thanks to perennial militant crises in the country’s Niger Delta. This is as exports of two Nigerian crude grades are suffering significant disruptions following a turbulent week in the oil-producing delta region. Renewed attacks on…

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