TODAY.AZ / Business

Oil prices rise on world markets

19 April 2019 [17:23] - TODAY.AZ

By Azernews

By Abdul Kerimkhanov

Crude oil futures rose on Friday amid falling exports from Saudi Arabia, the de facto leader of OPEC. The price of "black gold" was also supported by the decline in U.S. stocks.

Brent futures rose 35 cents to $ 71.97 a barrel. For the week, the price for Brent increased by 0.6 percent. After the exchange closed, the price rose by another 4 cents to $ 72.01 per barrel.

WTI futures for U.S. crude increased by 24 cents to $ 64.00 a barrel. For the week, the price increased by 0.2 percent.

Meanwhile, the price of the AZERI LT CIF oil produced at Azeri-Chirag-Gunashli block of oil and gas fields amounted to $74.5 per barrel at Italian port of Augusta on April 18, which is $0.09 more than on April 17, a source in Azerbaijan's oil and gas market told Trend.

On April 18, the AZERI Light FOB Ceyhan oil price was $73.82 per barrel, or $0.13 more than the previous price.

Oil prices rose slightly on Thursday against the background of declining U.S. reserves, declining production by major producers and current U.S. sanctions against Venezuela and Iran.

On April 18, the AZERI Light FOB Ceyhan oil price was $73.82 per barrel, or $0.13 more than the previous price.

The rise in oil prices was observed following the weekly report of the Energy Information Administration of the U.S. Department of Energy (EIA) published on Wednesday which said that U.S. crude oil inventories fell by 1.4 million barrels a week against a growth of 17 million barrels in the previous three weeks.

"The rise in oil prices occurred despite a slight decrease in oil reserves of the United States. Partly the latter is due to the fact that oil imports returned to the level of 6 million barrels per day. At the same time, U.S. production levels remained stable,” said analysts of the Vienna-based JBC Energy.

This year, oil prices were supported by the agreement between OPEC and non-cartel members to reduce production by 1.2 million barrels per day.

Market supply declined even more as a result of the introduction of U.S. sanctions against Venezuela and Iran.

Analysts argue about how much the rise in oil prices may affect U.S. President Donald Trump in his decision to extend the exemptions for Iranian oil buyers, which expire next month.

“Given that the forward price curve in recent weeks has shown growth, we assume that prices will remain consistently high until the president decides on exemptions for Iranian oil buyers,” said Tariq Zahir, Tyche Capital Advisors managing officer.

“Saudi Arabia can continue to produce significantly less oil than agreed upon within the agreement with OPEC+ countries. Production levels in Venezuela may continue to decline, and the situation in Libya may remain unstable due to civil war. Subject to these conditions, we will not be surprised if the president extends the expiration of sanctions for buyers of Iranian oil to prevent price increases.”

Major oil producers have reached a deal to reduce oil production by 1.2 million barrels per day at the 5th meeting of OPEC and non-OPEC ministers held in Vienna on December 7.

It has been agreed to reduce daily oil production by 0.8 million barrels per day (2.5 percent) for OPEC countries in the first six months of 2019. Non-OPEC countries have agreed to reduce oil production by 0.4 million barrels per day (2 percent). As part of the agreement, Azerbaijan has reduced daily production by 20,000 barrels since January 1, 2019.


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