Connect with us

Crude Oil

Aiteo Reports ‘High Order’ Spill from Oil Well

Published

on

Nigeria's aiteo

Nigeria’s Aiteo, a Lagos-based international oil and gas company has reported an oil spill that is classified as “extremely high order” from one of its wells in the Niger Delta region of Nigeria.

The well, which is jointly owned by Aiteo and NNPC was found out to be leaking last Friday without a determined cause. Aiteo however did not rule out vandalism and oil theft as a possible cause of the massive leak. The company mentioned that the incident had been reported to regulators, and had mobilized specialists to close the leak. Aiteo has had to suspend immediate efforts to control the leak due to the pressure coming out of the well head.

Environmental Rights Action, a local environment group said the latest spill in Yenagoa, Bayelsa state was another incident that would have a highly negative impact on the marine ecosystem on which most fishing activities depend. The Niger Delta is a large maze of creek and mangrove swamps with cris-crosses of pipelines. However, the region is highly troubled by pollution, violence, corruption and poverty. The history of vandalism and oil theft in the Niger Delta is enough reason for Aiteo to consider that as a possible cause of the spill, even though the spill could have been caused by other factors.

Oil spills in Nigeria have had extremely catastrophic effects on areas whose people rely on creeks as the only water supply, and who focus on fishing and farming as their means of livelihood. The oil spills would make such water harmful to both crops and fish, causing them to die. It would also take away the people’s access to healthy water.

Aiteo spokesman Ndiana Matthew said that the well is part of assets that Aiteo purchased from Royal Dutch Shell back in 2015.

Alagoa Morris, Environmental Rights Action’s field officer in the Niger Delta castigated Aiteo, saying that regardless of the cause of the spill the company should have taken proper steps to ensure that the spill is cleaned up properly. This statement however does not take into consideration the problems which Nigerian oil companies have run into while trying to clean up oil spills in recent years. Sometimes, obstruction by local gangs looking to get massive pay-outs from the companies can hinder the cleaning process.

However, this is no excuse for Aiteo, as it is their responsibility to clean up after mishaps that bear the company name.

 

Continue Reading
Comments

Crude Oil

Oil Prices Drop 3 Percent on Tuesday After Moderna’s CEO Comment

Published

on

Oil prices - Investors King

Oil prices tumbled more than 3% on Tuesday after Moderna’s CEO cast doubt on the efficacy of COVID-19 vaccines against the Omicron coronavirus variant, spooking financial markets and adding to worries about oil demand.

The head of drugmaker Moderna told the Financial Times that COVID-19 vaccines are unlikely to be as effective against the Omicron variant of the coronavirus as they have been against the Delta variant.

Brent crude futures fell $2.32, or 3.2%, to $71.12 a barrel at 0912 GMT after slipping to an intraday low of $70.52, the lowest since Sept. 1.

U.S. West Texas Intermediate (WTI) crude futures fell $2.15, or 3.1%, to $67.80 a barrel, off a session low of $67.06, the weakest since Aug. 26.

Fed Chairman Jerome Powell will also tell U.S. lawmakers later in the day the variant could imperil economic recovery, prepared remarks show.

“The economic impact is driven by fear, and by the policy response… Fear is impacting travel. There are outright bans. But also the fear of being stranded which causes travel plans to alter,” Paul Donovan from UBS said in a note.

Oil plunged around 12% on Friday along with other markets on fears the heavily mutated Omicron would spark fresh lockdowns and dent global oil demand. It is still unclear how severe the new variant is.

With a weakening demand outlook , expectations are growing that the Organization of the Petroleum Exporting countries, Russia and their allies, together called OPEC+, will put on hold plans to add 400,000 barrels per day (bpd) to supply in January.

“We think the group will lean towards pausing output hikes in light of the Omicron variant and the oil stockpile release by major oil consumers,” Commonwealth Bank commodities analyst Vivek Dhar said in a note.

Pressure was already growing within OPEC+, due to meet on Dec. 2, to reconsider its supply plan after last week’s release of emergency crude reserves by the United States and other major oil-consuming nations to address soaring prices.

“Following the global strategic reserve releases and the announcement of dozens of countries restricting travel… OPEC and its allies can easily justify an output halt or even a slight cut,” OANDA analyst Edward Moya said in a note.

Still, Citi analysts expect OPEC+ to continue to add more barrels in January.

Continue Reading

Crude Oil

New COVID Variant: Brent Crude Sheds Over $10 to $72 Per Barrel

Published

on

Crude oil - Investors King

Brent crude oil extended decline by over $10 on Friday on concerns that a new COVID variant called B.1.1.529 could force economies to impose restrictions and slow down global demand.

Brent crude, against which Nigerian crude oil is measured, dropped from $82.55 per barrel it attained on Thursday to as low as $72.09 on Friday at 7:20 pm Nigerian time before it rebounded slightly to $72.98 per barrel as shown below.

Global financial markets plunged across the board following reports that two cases of the new heavily mutated COVID variant from South Africa have been reported in Hong Kong and that the United Kingdom, one of the most affected nations during COVID-19 with over 140,000 deaths has halted flights from six South African nations to prevent a potential breakout of the new COVID variant.

Experts are concerned that the new variant outbreak would slow down global growth and increase global risks going into the new year.

According to Craig Erlam, Senior Market Analyst, UK & EMEA, OANDA, “Even without severe restrictions, people will adopt more caution which will weigh on demand, as OPEC+ has repeatedly stated and factored into their models.”

However, heavy crude oil-consuming nations like the United States, China and others that have been calling for more supply will now enjoy substantial price reduction if this continues, therefore, Joe Biden may not need to release millions of barrels into the global market.

“Crude is back at levels last seen at the start of October and if this risk aversion continues in the weeks ahead, there’s plenty of room to fall. While OPEC+ would likely have avoided altering production plans next week or in the months following in response to the SPR releases, it may soon feel its hand is being forced. Next week may come too soon but another major outbreak could see them slam on the brakes,” Craig Erlam added.

 

Continue Reading

Crude Oil

Concerns Over New COVID Variant Plunges Brent Crude Oil Below $80 a Barrel

Published

on

Oil

Concerns over rising new COVID variant in South Africa, Asia and other regions weighed on Brent crude oil and other financial assets on Friday.

The heavily mutated COVID variant called B.1.1.529 plunged Brent crude oil, against which Nigerian crude oil is priced, by almost 4 percent on Friday to trade below $80 a barrel for the first in months.

Brent crude dropped $3.16 or 3.8 percent to $79.06 per barrel while the US West Texas Intermediate (WTI) sheds $3.45 or 4.4 percent to $74.94 a barrel.

“Oil prices have gapped lower in Asia as the South African variant sparks’ growth fears, sending a wave of selling through Asian energy markets. Although gas and coal prices are holding steady, oil prices have tumbled,” stated Jeffrey Halley, Senior Market Analyst, Asia Pacific, OANDA.

Commodity prices dropped after the United Kingdom announced it has halted all flights from six South African nations. In Hong Kong, two cases of the new variant were detected on Friday.

“With US markets closed for holidays, investors are voting with their feet this morning. The one bull in the China shop that could truly derail the global recovery has always been a new strain of Covid-19 that swept the world and caused the reimposition of mass social retractions.”

This was coming two days after U.S President Joe Biden announced his administration plans to release millions of barrels of oil from strategic reserves to cool rising crude oil prices and rein in fuel price in the world’s largest economy.

Global financial markets experts are worried that the new variant will slow down global growth and force economies to start shutting down following the U.K announcement on Thursday.

Today, investors across the world will be paying attention to the outcome of meeting between WHO and South African officials, and the evolution of the B.1.1.529 variant. This will dictate market reaction for next week.

Continue Reading
Advertisement




Advertisement
Advertisement
Advertisement

Trending