TODAY.AZ / Business

Crude prices tumble on backdrop of OPEC+ meeting

08 August 2017 [13:46] - TODAY.AZ

By Azernews

By Sara Israfilbayova

World oil prices are down on August 8, while investors are waiting for the outcome of the meeting of the Technical Committee on monitoring of implementation of the agreement of the countries of OPEC and other oil nations.

Global benchmark Brent crude futures are down 0.2 percent, at $52.26 a barrel at, after dipping 0.1 percent in the previous session, while U.S. crude futures West Texas Intermediate (WTI) are down 0.1 percent, at $49.32 a barrel, having fallen 0.4 percent on August 7, according to Reuters.

Meetings in Abu Dhabi are being held on August 7-8 under the chairmanship of Russia and Kuwait, in the presence of representatives of Saudi Arabia.

The Committee at the meeting plans to discuss ways to boost compliance with the deal to cut 1.8 million barrels per day in production.

"Assuming that nothing comes from OPEC/non-OPEC's technical meeting in Abu Dhabi today, oil's near term fate will most likely be determined by the official U.S. Department of Energy inventory data tomorrow evening Asia time," said Jeffrey Halley, senior market analyst at futures brokerage OANDA in Singapore.

Furthermore, the U.S. Energy Information Administration, part of the Energy Department, will releases its weekly petroleum status report on August 9, giving details on stockpiles and refinery runs.

The American Petroleum Institute (API) will also release its report on oil reserves in the country on August 8. Reserves of oil in the U.S. for the week ended on July 28, unexpectedly rose by 1.8 million barrels, to 488.8 million. At the same time analysts had expected that stocks, on the contrary, would decline - by 2.9 million barrels.

Another factor, which affects decrease of world oil prices, is an increase in production of raw materials in Libya, which is not a party to the global pact.

Production from Libya's 270,000 barrels-per-day Sharara field was returning to normal after a brief disruption when armed protesters broke into a control room in the coastal city of Zawiya, the National Oil Corporation (NOC) said on August 7.

Libya was exempted from a push to cut global production and bolster oil prices led by the OPEC and other big producers like Russia.

OPEC and other major oil producers agreed in December 2016 to remove 1.8 million barrels a day from the market. 

The parties decided to extend the production adjustments for a further period of nine months, in May 2017.


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