Oil Higher After Saudi Arabia Announces Limit on Exports

WTI Crude Oil
Weekly September West Texas Intermediate Crude Oil
Author

25 July, 2017

Saudi Arabia, the world's top oil exporter, announced it would go further than cutting its production and would also limit its exports at 6.6 million barrels a day. A separate report showed that US oil production recovered to 9.43 million barrels per day, which is the highest level of production since August 2015, however.

In December, OPEC agreed with several non-OPEC producers led by Russian Federation to cut oil output by a combined 1.8 million barrels per day (bpd) from January 2017 until the end of March 2018 but Nigeria and Libya were exempted.

The cap was put in place to drain a glut of oil and support higher oil prices but has largely failed due to a massive increase in output from US suppliers and growth in output from Nigeria and Libya, both of which were exempt from the curbs.

Russian Energy Minister Alexander Novak said Libya and Nigeria should cap output when their output stabilised, the Financial Times reported.

This is given increased oil production in the Niger Delta following peace talks in the area that has caused violent attacks on oil facilities to cease.

PETERSBURG-The Organization of the Petroleum Exporting Countries and big oil-producing allies made a rare acknowledgment on Monday: They are part of the reason oil prices are low.

Sevilla sign Nolito from Manchester City on three-year contract
He becomes the Andalusians' fifth summer capture after Ever Banega, Sebastien Corchia, Guido Pizarro and Luis Muriel. City have had a number of requests to take Nolito on loan but were determined to hold out for a fee.

The Saudi energy minster added that the production-cut agreement could be extended beyond March if necessary but any further extension would rely on non-compliant nations adhering to the agreement. The group is likely to become less compliant with its cuts toward the end of this year, with the risk of a domino effect after some members suggested they won't adhere to their targets, according to JPMorgan Chase & Co.

The number of active oil rigs in the United States fell this week by 1 rig-it's second loss in four weeks, and its third loss this year-in a sign that the gains we've seen week after week are starting to slow.

Oil prices rose slightly on Monday.

Falih said that weaker compliance with cuts by some OPEC members and a rise in OPEC exports were helping soften prices.

In a statement following the meeting, the countries in the monitoring committee said "the oil market is making steady and significant progress towards rebalancing" after being hit by a vast glut in recent years. The global benchmark crude traded at a premium of $2.35 to WTI.


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