Global crude oil scenario and major news

19 Sep 2022 , 08:23 AM

Early on Monday in Asian trading, oil prices rose as concerns about supply ahead of the European Union’s embargo on Russian oil in December outweighed worries about a global recession that may reduce demand for fuel.

After closing up 0.5% on Friday, Brent crude futures increased $1.15, or 1.3%, to $92.50 a barrel. U.S. West Texas Intermediate crude was up $1.05 or 1.2% at $86.16 per barrel. On Tuesday, the front-month contract expires.

Both contracts were helped by a weaker dollar that was coming off of multi-year highs. Last week, both contracts fell more than 1% on worries that another interest rate hike by the Federal Reserve could hamper global growth. Dollar-denominated goods cost less to holders of foreign currencies when the U.S. dollar is weaker.

Concerns about demand in the world’s second-largest energy user, China, were allayed by the relaxation of COVID-19 limitations in Chengdu, a southern city of more than 21 million people. After Beijing announced new limits, China’s gasoline and diesel exports also increased, reducing excessive local stocks.

After being suspended owing to a spill that has already been contained, oil loading and exporting operations from Iraq’s Basrah oil terminal resumed on Saturday, according to Basrah Oil Company.

According to a spokesperson, maintenance of Shell’s 200,000 barrels per day Bonga deep water storage and offloading vessel is planned for October.

U.S. energy companies last week added oil and natural gas rigs for the first time in three weeks, signalling increased US supply.

The oil and gas rig count, a leading predictor of future production, increased by four to 763 in the week ending September 16, the most since August, according to energy services company Baker Hughes Co.

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