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Oil Updates – Oil at Multi-Month Low; The number of US oil rigs is falling; US to discuss Russian oil price cap with Indonesia

RIYADH: Oil prices stabilized on Friday, recouping some of this week’s losses on strong U.S. job growth, but closed the week at their lowest levels since February, rocked by fears that recession could affect fuel demand.

Brent crude gained 80 cents to $94.92 a barrel, 11% below last Friday’s settlement.

U.S. West Texas Intermediate crude gained 47 cents to $89.01, down 8% on the week.

The number of American oil rigs has fallen the most since September

This week, U.S. energy companies cut the number of oil rigs the most since September, with production gradually increasing as energy companies increase shareholder returns and face higher operating costs due to pressures inflationary and supply chain.

The number of oil rigs, an early indicator of future production, fell by seven to 598 in the week to August 5, the first weekly drop in 10 weeks, energy services company Baker Hughes said on Friday. Co. in its closely followed report.

Gas rigs rose by four to 161, their highest level since August 2019, while oil and gas combined fell by three to 764, bringing the total number of rigs to 273, or 56 %, compared to the same period last year, said Baker Hughes.

Even though total rig count rose for a record 24 months through July, weekly increases were mostly single digits and oil production is only expected to return to pre-pandemic record highs. next year.

US, Indonesia to discuss Russian oil price cap

A senior US Treasury Department official will travel to Indonesia and Singapore next week to discuss with counterparts the potential cap on Russian oil export prices planned in response to Moscow’s invasion of Ukraine, said announced Friday the department.

Elizabeth Rosenberg, the Treasury Department’s assistant secretary for terrorist financing and financial crimes, will travel to Jakarta Monday and Tuesday, and will travel to Singapore, a major oil hub, Wednesday through Thursday.

She will meet with government officials to discuss responses to Russia’s war in Ukraine, including capping the price of Russian oil, one of the main backers of President Vladimir Putin’s war machine. Rosenberg will also meet with business leaders in energy and finance.

US Treasury Secretary Janet Yellen has promoted the cap that would limit the amount oil refiners and traders can pay for Russian crude as a way to help lower global oil prices without reducing supply .

Indonesia’s state oil company PT Pertamina said in March it was considering buying crude from Russia as it sought crude for a refurbished refinery. But in May he was reconsidering the plan, according to news reports.

Critics have said a price cap could drive prices up, not down, if Russia decides to slow oil exports. Such a move could cost Russian oil producers dearly if they had to shut down wells as a result.

Russia’s offline primary oil refining capacity revised up 23% for August

Russia’s spare primary oil refining capacity was revised to 3.196 million tonnes in August, up 23% from the previous estimate, according to Reuters calculations based on data from Refinitiv Eikon.

Unused primary oil refining capacity for September was also revised up 11% to 4.295 million tonnes. The revisions follow several adjustments to Russian oil refinery maintenance plans.

(Contributed by Reuters)

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