Connect with us

Crude Oil

Oil Prices Face Downward Pressure Amid OPEC+ Uncertainty and Middle East Tensions

Published

on

Crude oil - Investors King

Oil prices find themselves caught in the crossfire of geopolitical tensions and the aftermath of the recent OPEC+ decision on Monday.

Brent crude oil, against which Nigeran oil is priced, shed 0.9% or 73 cents settled at $78.15 per barrel at about 7 am Nigerian time while the U.S. West Texas Intermediate crude oil experienced an 0.8% decline or 64 cents to $73.43 a barrel.

“Crude seems to be under continued pressure from the OPEC+ decision. Some degree of discounting of the deeper OPEC+ cuts is justified, but as of now, the crude complex has completely disregarded them,” stated Vandana Hari, the founder of Vanda Insights, an oil market analysis provider.

Last week, oil prices suffered a slump of over 2%, fueled by investor skepticism regarding the depth of supply cuts committed to by the Organization of the Petroleum Exporting Countries and its allies, collectively known as OPEC+.

Lingering concerns about sluggish global manufacturing activity added to the pessimism.

The OPEC+ cuts, declared as voluntary on Thursday, have raised doubts about the full implementation of the proposed reductions and left investors questioning the metrics for measurement.

As the global focus shifts to the Middle East, geopolitical tensions resurface with renewed hostilities in Gaza.

Against this backdrop, three commercial vessels faced attacks in international waters in the southern Red Sea, leading to heightened concerns over potential supply disruptions.

While the resumption of the Israel-Hamas conflict injected a bullish momentum into oil prices, analysts, including CMC Markets’ Tina Teng, remain cautious.

“However, oil prices may continue to be under pressure for the time being due to China‚Äôs disappointing economic recovery and the ramp-up of U.S. production”, Teng stated.

Amid this intricate web of challenges, the specter of additional sanctions on Russia and a potential pause in sanctions relief for OPEC member Venezuela by the White House further add layers of complexity to the already delicate global oil market.

As the world watches, uncertainties persist, shaping the future trajectory of oil prices in an intricate dance of geopolitics and market dynamics.

Continue Reading
Comments

Crude Oil

Oil Prices Slide as U.S. Crude Stockpiles Surge, Heightening Demand Concerns

Published

on

Crude oil

Oil prices declined on Thursday as concerns over demand intensified due to a larger-than-anticipated build in U.S. crude stockpiles.

Brent crude oil, against which Nigerian oil is priced, dropped by 0.5% to $83.25 a barrel while U.S. West Texas Intermediate crude oil fell by 0.3% to $78.28 a barrel.

The Energy Information Administration’s report revealed a substantial increase in U.S. crude oil stockpiles by 4.2 million barrels to 447.2 million barrels for the week ending February 23rd.

This surge surpassed analysts’ expectations and marked the fifth consecutive week of rising inventories.

While gasoline and distillate inventories witnessed a decline, concerns regarding a sluggish economy and reduced oil demand in the U.S. were amplified.

Satoru Yoshida, a commodity analyst with Rakuten Securities, highlighted that the significant stockpiles have heightened investor worries.

Moreover, the anticipation of delayed U.S. interest rate cuts further weighed on market sentiment, potentially undermining oil demand.

Traders have adjusted their expectations for rate cuts, with an easing cycle predicted to commence in June rather than March as previously anticipated.

Market participants await the U.S. personal consumption expenditures price index for insights into inflation trends, while the possibility of an extension of voluntary oil output cuts from OPEC+ looms over price dynamics, amid lingering uncertainty in the demand outlook and geopolitical tensions in the Middle East.

Continue Reading

Crude Oil

Crude Oil Shortage Threatens Dangote, Government Refineries, Minister Raises Alarm

Published

on

Dangote Refinery

The Minister of State for Petroleum Resources (Oil), Heineken Lokpobiri, has sounded a clarion call over a looming crude oil shortage that threatens the operations of the newly inaugurated Dangote Petrochemical Refinery and government-owned refineries in Nigeria.

Addressing stakeholders at the seventh edition of the Nigeria International Energy Summit in Abuja, Minister Lokpobiri expressed concerns that unless deliberate efforts are made to increase investments and crude oil production, these refineries may struggle to obtain enough feedstock for petroleum product manufacturing.

The Dangote refinery, a colossal project spearheaded by Dangote Industries Limited, has a daily requirement of up to 650,000 barrels of crude oil, while government-owned refineries could need approximately 400,000 barrels.

However, the current pace of crude oil production and investment in Nigeria falls short of meeting these demands.

Minister Lokpobiri highlighted the need to ramp up production and attract investments in the upstream sector to ensure adequate feedstock supply for the refineries.

He emphasized the importance of efficiently utilizing Nigeria’s abundant oil and gas reserves to enhance domestic energy security and economic prosperity.

Furthermore, the minister underscored the significance of investing in energy infrastructure and transitioning towards more environmentally friendly practices to address Nigeria’s energy needs effectively.

The alarm raised by Minister Lokpobiri underscores the urgency for strategic interventions and collaborative efforts to mitigate the impending crude oil shortage and secure the future of Nigeria’s refining industry amidst evolving global energy dynamics.

Continue Reading

Crude Oil

Oil Prices Surge as Brent Approaches $83, WTI Nears $78 Amidst Refinery Buying Activity

Published

on

Crude oil - Investors King

Oil prices surged as Brent crude oil approached the $83 price level while West Texas Intermediate (WTI) neared $78 as refineries in the United States and China increased purchases.

Brent crude oil, against which Nigerian oil is priced, gained 1.1% on Monday, signaling a bullish trend in the oil market.

The recent uptick in oil prices comes amidst signs of heightened demand from refineries, particularly in key markets like the US and China.

This surge in demand has contributed to the strengthening of timespreads, indicating tighter conditions in the near term.

Market observers are closely monitoring the International Energy Week in London, where industry leaders are convening to discuss the outlook for the global energy market.

Scheduled speakers include Russell Hardy, the CEO of Vitol Group, a major player in the energy sector.

While tensions in the Middle East and production cuts by the OPEC+ alliance have supported crude prices, increased production from non-OPEC+ countries, notably the US, has capped potential gains.

Analysts predict that oil prices may continue to trade within a range, with Brent crude expected to hover around $83, while WTI remains near the $78 mark, barring significant shifts in market dynamics.

Continue Reading
Advertisement




Advertisement
Advertisement
Advertisement

Trending