source Emergy Mix Report on Oct 7, 2019
Oil prices fell on Monday, extending last weekâ€™s heavy losses, with traders fearing the global economic slowdown will weigh on future oil demand growth while pegging hopes for a rebound on progress in talks this week on ending the U.S.-China trade war.
Brent crude futures LCOc1 edged down 28 cents to 58.09 dollars a barrel by 0300 GMT, while U.S. West Texas Intermediate (WTI) crude CLc1 was at 52.64 dollars, down 17 cents.
Both contracts ended last week with a more-than-5 per cent decline after dismal manufacturing data from the United States and China, as the lingering row between the worldâ€™s top economies hurts global growth and raises the risk of recession.
U.S. and Chinese officials will meet in Washington on Oct. 10-11 in the next, much-anticipated fresh effort to work out a deal.
On the supply side, a faster-than-expected resumption in Saudi Arabiaâ€™s production after a Sept. 14 attack on key production facilities also exerted downward pressure on oil prices, although the Middle East remained tense.
â€œThe macro headwinds outweigh supply concerns for oil now, despite tensions in the Middle East and a reduced spare capacity pillow,â€ said Stephen Innes, Asia Pacific market strategist at AxiCorp.
In Iraq, the second-largest producer among the Organization of the Petroleum Exporting Countries, deadly anti-government unrest is posing the biggest security and political challenge so far to Prime Minister Adel Abdul Mahdiâ€™s year-old government.
Iraqâ€™s oil exports of 3.43 million barrels per day (bpd) from Basra terminals could be disrupted if instability lasts for weeks, Ayham Kamel, Eurasia Groupâ€™s practice head for Middle East and North Africa, said in a note.
â€œAny oil production disruption would occur at a time when Saudi Arabia has lost a significant part of its energy system redundancies (spare capacity),â€ he said.
â€œWhile Saudi oil production is now close to 9.9 million bpd, it is not clear that the capacity is fully operational at 11.3 million bpd and the (attacked) Abqaiq facility has lost a significant part of its redundancy.â€
Global supply also faces facility repair and maintenance pressures.
The Buzzard oil field in the British North Sea has been shut for pipe repair work, a spokesman from Chinaâ€™s CNOOC said on Friday.
Buzzard is the main contributor to the Forties crude stream, the largest of the five North Sea oil grades that underpin Brent crude futures.
Meanwhile Libyaâ€™s National Oil Corporation (NOC) said on Sunday it will close the Faregh oil field at Zueitina port for scheduled maintenance from Monday until Oct. 14.
Two Royal Dutch Shell Plc units were sued over their involvement in one of the largest oil spills in Nigeriaâ€™s history. Shell Nigeria Exploration & Production Co. and Shell International Trading & Shipping Co. allegedly undermined the emergency response to the spill eight years ago and made inadequate efforts to contain it, according to lawyersâ€¦
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The Nigeria Extractive Industries Transparency Initiative (NEITI), and other stakeholders in the oil and gas sector, yesterday, in Abuja, insisted that inadequacy in the metering of crude oil production in the country could continue to affect the nationâ€™s revenue. Indeed, without urgent efforts to address the situation, the stakeholders believe the volume of oil stolenâ€¦
The Secretaries General of the Organization of the Petroleum Exporting Countries (OPEC) and the Gas Exporting Countries Forum (GECF) today signed a Memorandum of Understanding (MoU) to strengthen cooperation in research and the sharing of best practices. HE Mohammad Sanusi Barkindo, Secretary General of OPEC, and his GECF counterpart, HE Yury Sentyurin, signed the MoUâ€¦
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