Oil Steady, Supported by OPEC Cuts

Friday, March 1, 2019

Record U.S. output, exports offset some of OPEC's cuts.

Oil prices were broadly steady on Friday as surging U.S. supply and concerns of a global economic slowdown were offset by falling OPEC output.

International Brent crude futures were at $66.39 per barrel at 1231 GMT, up 8 cents from Thursday's settlement.

U.S. West Texas Intermediate (WTI) crude oil futures were at $57.38 per barrel, up 16 cents.

"Oil prices are finely balanced in today's trading session," senior Interfax Energy analyst Abhishek Kumar said.

The 14-member Organization of the Petroleum Exporting Countries pumped 30.68 million barrels per day (bpd) in February, a Reuters survey showed on Friday, down 300,000 bpd from January and the lowest OPEC total since 2015.

In Venezuela, oil exports have plunged by 40 percent to around 920,000 barrels per day (bpd) since the U.S. government slapped sanctions on its petroleum industry on Jan. 28.

OPEC, of which Venezuela is a founding member, is leading efforts to withhold around 1.2 million bpd of supply from the market to prop up prices. Venezuela is exempt from the cuts.

"OPEC and its 10 allies are doing their job and this time they are stubborn," London-based brokerage PVM said in a note, referring to the supply restrictions which have been in place since the start of the year.

The fall in OPEC production comes at a time when the United States is pumping oil at record rates.

The U.S. Energy Department said on Thursday it was offering up to 6 million barrels of crude from national emergency stocks to raise funds to modernise U.S. strategic oil reserves.

Canada's main oil-producing province of Alberta on Thursday raised the amount of crude that companies can produce in April to 3.66 million barrels per day, an increase of 100,000 bpd from the limit imposed in January.

On the demand side, a Reuters poll showed analysts expect global fuel demand to dip this year in the face of a broad economic slowdown.

China's February factory activity fell for a third month as the world's second-largest economy continued to struggle with weak export orders, a private survey showed on Friday.

The weakness is also being felt across the wider region. South Korea's exports contracted at their steepest pace in nearly three years in February as demand from China cooled further.

Despite this, fuel consumption, especially in Asia's developing economies which are key drivers of global oil demand, is so far holding up.

India's diesel consumption, for example, is expected to rise to a record this year amid economic growth of around 7 percent.

Reporting by Henning Gloystein and Ahmad Ghaddar


Categories: Finance Energy Logistics Drilling Activity

Related Stories

FOS Picks Incat Crowther to Design Fast CTV Fleet for Shell’s Brunei Ops

Oil Prices Edge Higher Amid Uncertainty Over Iran Deal

CNOOC’s First Quarter Profit Rises on Higher Oil Prices, Output

UAE Exit Weakens OPEC, Raises Risk of Price War

United Arab Emirates Exits OPEC and OPEC+

Middle East Conflict Jolts Offshore Drilling Market

Eni Makes Major Gas Discovery Offshore Indonesia

Oman’s Block 50 Offshore Drilling Ops Pushed to May

PV Drilling Names New ‘Super Rig’ ahead of April Operations

Arabian Drilling Flags Temporary Offshore Rig Suspensions in Persian Gulf

Current News

TotalEnergies, QatarEnergy, ConocoPhillips Ink MOU to Review Offshore Syria

Norway O&G Revenue Forecast Jumps 30% for '26

QatarEnergy, TotalEnergies and ConocoPhillips Team Up on Syria Offshore Block

FOS Picks Incat Crowther to Design Fast CTV Fleet for Shell’s Brunei Ops

Dolphin Drilling Boosts Backlog with Harbour Energy Deal, Oil India Extension

Oil Prices Edge Higher Amid Uncertainty Over Iran Deal

ADNOC Drilling Posts Record First-Quarter Results with 5% Revenue Rise

Oil Jumps 4% After Trump Rejects Iran’s Peace Response

Lloyd’s Register Approves Wison’s Internal Turret FPSO Concept

Gulf Marine Services Profit Plunges After Gulf Vessel Evacuations

Subscribe for AOG Digital E‑News

AOG Digital E-News is the subsea industry's largest circulation and most authoritative ENews Service, delivered to your Email three times per week

https://accounts.newwavemedia.com