Brent crude futures fall amid efforts to bring more supply to market from other major producers
11 March 2022 - 08:11
bySonali Paul and Mohi Narayan
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New Delhi — Oil prices stabilised on Friday and were on track for their biggest weekly drops since November after see-sawing on fears of escalating bans on Russian oil versus efforts to bring more supply to market from other major producers.
Brent crude futures inched down 16c, or 0.15%, to $109.17 a barrel at 4.34am GMT after dropping 1.6% in the previous session.
US West Texas Intermediate (WTI) crude futures were up 2c, or 0.02%, to $106.04 a barrel, after a 2.5% decline on Thursday.
In a week of volatile trading marked by talk of Russian oil embargoes then potential supply additions from Iran, Venezuela and the United Arab Emirates while fighting escalated in Ukraine, Brent was on track for a weekly fall of about 7% after hitting a 14-year high of $139.13. US crude was headed for a drop of about 8% after touching a high of $130.50.
“Both contracts could well move sharply below $100 a barrel from here on any news perceived as easing supply disruptions,” said Jeffrey Halley, an analyst at Oanda.
Similarly, both contracts could easily be back at $115.00+ on any negative headlines, he said. “It’s just that sort of market.”
Prices eased this week after it became clear the EU, heavily reliant on Russian energy, would not join the US and Britain in banning Russian oil.
Russia, the world’s second largest crude exporter behind Saudi Arabia, exports about 3-million barrels a day of crude to Europe’s Organisation for Economic Co-operation and Development countries.
In the near term, supply gaps are unlikely to be filled by extra output from members of Opec and allies, together called Opec+, given that Russia is part of the grouping, Commonwealth Bank analyst Vivek Dhar said.
“They’re really tied politically by the structure,” he said.
In addition, some Opec+ producers, including Angola and Nigeria, have struggled to meet their production targets, further limiting the group’s ability to offset Russian supply losses.
Commonwealth Bank forecasts Brent will average $110 in the second and third quarters of this year, but sees prices potentially climbing as high as $150 in the short term.
“All of it is very uncertain. It’s been very difficult to come out with a view,” Dhar said.
Support our award-winning journalism. The Premium package (digital only) is R30 for the first month and thereafter you pay R129 p/m now ad-free for all subscribers.
Oil steadies as supply concerns ease
Brent crude futures fall amid efforts to bring more supply to market from other major producers
New Delhi — Oil prices stabilised on Friday and were on track for their biggest weekly drops since November after see-sawing on fears of escalating bans on Russian oil versus efforts to bring more supply to market from other major producers.
Brent crude futures inched down 16c, or 0.15%, to $109.17 a barrel at 4.34am GMT after dropping 1.6% in the previous session.
US West Texas Intermediate (WTI) crude futures were up 2c, or 0.02%, to $106.04 a barrel, after a 2.5% decline on Thursday.
In a week of volatile trading marked by talk of Russian oil embargoes then potential supply additions from Iran, Venezuela and the United Arab Emirates while fighting escalated in Ukraine, Brent was on track for a weekly fall of about 7% after hitting a 14-year high of $139.13. US crude was headed for a drop of about 8% after touching a high of $130.50.
“Both contracts could well move sharply below $100 a barrel from here on any news perceived as easing supply disruptions,” said Jeffrey Halley, an analyst at Oanda.
Similarly, both contracts could easily be back at $115.00+ on any negative headlines, he said. “It’s just that sort of market.”
Prices eased this week after it became clear the EU, heavily reliant on Russian energy, would not join the US and Britain in banning Russian oil.
Russia, the world’s second largest crude exporter behind Saudi Arabia, exports about 3-million barrels a day of crude to Europe’s Organisation for Economic Co-operation and Development countries.
In the near term, supply gaps are unlikely to be filled by extra output from members of Opec and allies, together called Opec+, given that Russia is part of the grouping, Commonwealth Bank analyst Vivek Dhar said.
“They’re really tied politically by the structure,” he said.
In addition, some Opec+ producers, including Angola and Nigeria, have struggled to meet their production targets, further limiting the group’s ability to offset Russian supply losses.
Commonwealth Bank forecasts Brent will average $110 in the second and third quarters of this year, but sees prices potentially climbing as high as $150 in the short term.
“All of it is very uncertain. It’s been very difficult to come out with a view,” Dhar said.
Reuters
Oil bounces on renewed uncertainty about supply
Oil soars to whisper away from $140 a barrel on Russian ban
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