World News
Oil Incurs Big Weekly Loss As Potential OPEC Output Swells Even Larger
A late-stage – and modest – rise in oil prices on Friday wasn't enough to counter a week of bearish performance or prevent the commodity from heading towards a big weekly loss, with the analytical community still fixated on this Sunday's meeting of the Organization of the Petroleum Exporting Countries (OPEC).
Concern remains that the cartel will agree to a rumoured output hike of as much as 548,000 barrels per day (bpd, and substantially more than the last rumoured hike of 500,000 bpd) over the next three months, thus exacerbating what is perceived to be a saturated crude market.
Analysts at Capital Economics said, "Irrespective of whether OPEC+ opts for an ambitious output hike or a more manageable one for members, the oil market is facing a large supply glut."
Reportedly, Moscow is said to prefer a more modest 137,000 bpd bump.
As of 1617 GMT, Brent edged up 54 cents at $64.75 per barrel, and West Texas Intermediate was up 72 cents at $61.17 per barrel.
Fiona Cincotta, senior markets analyst at City Index, observed that, "Oil prices are stabilizing at $60.00 a barrel after falling over 7.5 percent this week, reaching a 16-week low."
In addition to the OPEC meeting, Sunday is also the deadline for Hamas to either accept or reject the U.S.-backed Israel-Palestine 20-point peace proposal to end the war in Gaza.
Analysts say an agreement could facilitate smooth oil and energy transit, and that any reduction in geopolitical tension could stabilize energy prices; but if Hamas rejects the deal, Washington has given Israel full backing to destroy the militant group, leading to the worry that a wider conflagration could disrupt oil flows from the Middle East.
Another potential influence on oil trading in the near future is news that the U.S. will provide Ukraine with intelligence support for long-range strikes against Moscow's energy infrastructure, one possible outcome being a heightened risk of Russian supply disruption.
Barbara Lambrecht, analyst at Commerzbank, added, "The risk of tougher sanctions on Russian oil poses a counterweight to any sharp price drops."
Key Bunker Prices More
| VLSFO | MGO | |||
|---|---|---|---|---|
| $/mt | +/- | $/mt | +/- | |
| Singapore | 484.50 | 6.00 | 686.00 | 8.00 |
| Rotterdam | 443.00 | 8.00 | 669.00 | 9.00 |
| Houston | 461.50 | 10.00 | 664.00 | 13.50 |
| Fujairah | 484.50 | 3.00 | 730.00 | 1.50 |
| Global 20 Ports Average | 514.00 | 2.50 | 763.50 | 4.00 |
| Global 4 Ports Average | 468.50 | 6.50 | 687.00 | 8.50 |
| Global Average Bunker Price | 563.50 | 7.00 | 803.00 | 1.50 |
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