Brent prices jumped by $11 in the month of September marking the largest gain in three days since 1990, according to a market update. The latest findings from KPMG showed volatility in the oil markets has persisted in August and mid-September brought on by China’s financial slump and its wider effect on the markets. The price jump per barrel was influenced by speculation of an OPEC production cut.
The price of Brent crude has broken back above the $50 barrier as a report on inventories in the US outweighed a gloomy outlook on manufacturing in China. Benchmark Brent rose more than 2% after the Energy Information Administration said US crude inventories fell 1.9 million barrels to 453.97 million last week, exceeding analysts expectations.
Oil halted a surge above $46 as investors weighed Iran’s progress toward raising output amid a market glut against signs of reduced U.S. supplies.
The big oil producing countries keep on pumping, even though prices are at a six-year low.
Oil in London slid below $45 a barrel for the first time since March 2009 as Iran reiterated it will boost production and U.S. drillers showed no signs of slowing. Brent futures fell as much as 2.7 percent, extending a 7.3 percent drop last week, the most in five months. Iran will expand output “at any cost” to defend market share, Oil Minister Bijan Namdar Zanganeh said, according to his ministry’s news website. The number of active oil rigs in the U.S. rose for the seventh time in eight weeks, Baker Hughes Inc. data showed Friday.
When the financial crisis brought the global economy to its knees, Norway was largely unscathed. But oil under $50? That's another story. Unemployment peaked at about 3.7 percent in 2010 in the post-crisis aftermath. Falling oil prices already pushed the jobless rate to 4.3 percent in May, the highest in at least 11 years, and that was before a renewed drop in Brent crude. Here are a few ways it's harder for Norway to deal with plunging oil prices than a global financial meltdown.
The oil guru who predicted last year’s rout said $100-a-barrel crude is likely to return within five years as faltering supply fails to meet demand. Gary Ross, the founder of consultants PIRA Energy Group, said oil markets aren’t nearly as oversupplied as many believe and spare capacity is tight since Saudi Arabia is pumping all the crude it can without new drilling. “Current prices are unsustainable,” he said Monday in an interview in London. “It’s hard not to see oil hitting $100 a barrel at some point in the next five years.”
Brent held losses near a two-week low amid a broader rout in commodities as Iran’s plan to regain market share bolstered speculation a global glut will persist. Futures were little changed in London after falling 0.8 percent Monday. Iran is seeking to restore production once sanctions are removed regardless of the impact on prices, Oil Minister Bijan Namdar Zanganeh said. US crude stockpiles are set to remain almost 100 million barrels above the five-year seasonal average even as supplies are forecast to have dropped for a second week. Brent’s recovery from a six-year low has faltered on signs the surplus will be prolonged as Iran seeks to restore output after its nuclear accord with world powers, joining OPEC members in defending market share. The full impact of increased Iranian exports won’t be observed until 2016, banks including Citigroup Inc. predicted.
Oil dropped to a three-month low in New York on the prospect that increasing Iranian shipments will extend the global supply glut. West Texas Intermediate crude extended losses in the wake of a third weekly retreat. Iran will focus on regaining oil sales it lost due to sanctions regardless of the impact on prices, Oil Minister Bijan Namdar Zanganeh said in Tehran. The United Nations Security Council unanimously adopted an Iran deal resolution Monday.
Brent slid below $60 a barrel for the first time since April amid speculation Greece’s rejection of austerity measures will prompt its exit from the euro area. Futures dropped as much as 1.6 percent in London, falling for a second day. Sixty-one percent of voters backed Prime Minister Alexis Tsipras’s rejection of further spending cuts and tax increases. U.S. Secretary of State John Kerry tempered expectations that a nuclear deal with Iran is imminent as diplomats meeting in Vienna work toward a Tuesday deadline. Oil last week slumped the most since March amid speculation the Greek crisis threatens Europe’s economic stability and growth, prompting investors to eschew riskier assets. Iran, the fourth-largest member of the Organization of Petroleum Exporting Countries, has estimated it could double crude exports from about 1 million barrels a day within six months of sanctions being lifted. “We’ve seen a bit of a capitulation in oil,” Ric Spooner, a chief analyst at CMC Markets in Sydney, said by phone. “The situation in Greece has a confidence impact on demand. A nuclear agreement with Iran represents a negative risk event for oil in terms of the possible significant increase in supply.”
Oil held losses below $60 a barrel as near- record U.S. production prolonged an oversupply amid the lowest trading volatility in eight months. Futures were little changed in New York after declining 1 percent on Thursday. U.S. crude stockpiles remained 84 million barrels above the five-year average for this time of the year while the nation pumped near the fastest pace in more than three decades of weekly government data. A measure of price fluctuations in West Texas Intermediate dropped to the lowest level since Oct. 29.
Oil extended its slide below $50 a barrel before US government data forecast to show crude inventories expanded from a record high in the world’s biggest consumer. Futures fell as much as 1.2% in New York for a fifth day of declines, the longest losing streak since August. Crude stockpiles probably rose by 3.75 million barrels last week, a Bloomberg News survey showed before an Energy Information Administration report on Wednesday.
Shell will shortly be seeking final approval to begin decommissioning the Brent oil and gas field. The energy giant is proposing to lift the 23,500-tonne top section of the Brent Delta platform in the first stage of the process. The Brent field, north east of the Shetland Islands, has produced about 10% of all UK North Sea oil and gas since production began in 1976. Its four platforms and their related infrastructure are the subject of a planned decommissioning programme over the coming decade. A 30-day public consultation on Shell’s plans to start the process will begin on Monday February 16.
Oil extended losses after a government report showed that US crude inventories increased a second week. Crude supplies rose 10.1 million barrels to 397.9 million in the week ended January 16, according to the Energy Information Administration. A 2.7 million-barrel stockpile gain was projected in a survey of 10 analysts.
Goldman Sachs said US oil prices need to trade near $40 a barrel in the first half of this year to curb shale investments as it gave up on OPEC cutting output to balance the market. The bank cut its forecasts for global benchmark crude prices, predicting inventories will increase over the first half of this year, according to a report. Excess storage and tanker capacity suggests the market can run a surplus far longer than it has in the past, said Goldman analysts including Jeffrey Currie in New York.
Predicting oil price movements is as risky as exploring for oil itself. The average price for crude fell 10.3% from the start of 2014 to the date of the Scottish independence referendum on September 18. It fluctuated over this period – but few, if any, were predicting any major move in either direction in the months to follow. Yet during the past three months we have seen another 48.4% fall. Geopolitical factors involving OPEC, the US, Russia and Iran, as well as the economic decline of China and the Eurozone, have been touted as contributory causes.
Norway is considering tapping reserve funds to shield western Europe’s biggest oil producer from the worst slump in crude prices in more than half a decade. Prime Minister Erna Solberg said the government is now “on alert” to respond to the rout. “If the economic situation requires it, we can react quickly,” she said yesterday at a conference in Oslo organized by Norway’s confederation of industry. A 56% plunge in the price of Brent crude since a June high has undermined Norway’s currency and beaten back its stock market.
The US stock market is bouncing back from a tough start to 2015. Investors sent shares sharply higher for a second straight day, erasing the market’s heavy losses from the first few days of the year. The gains were driven by a combination of positive economic news from the US and hopes for stimulus from Europe’s central bank. The price of oil is also showing signs of stabilising after six months of heavy losses, and there is renewed confidence that the Federal Reserve will keep supporting the economy as growth outside the US appears to be flagging.
Companies which own petrol stations should be hit with a windfall tax unless they pass on deep drops in oil prices to British drivers through cheaper fuel, a Tory MP has said. Nigel Evans said fuel industry firms not lowering their prices to £1 a litre should be shamed by MPs and then hit with a tax on their profits as the cost of crude oil tumbles. Mr Evans’ call comes after Sainsbury’s boss Mike Coupe predicted fuel prices would fall below £1 a litre as Brent crude was being traded at below 50 US dollars a barrel for the first time since 2009.
The steep decline in oil price paused yesterday for the first time in five days, after benchmark Brent caused consternation as it fell to below $50 a barrel. Crude prices at last turned positive as Brent hovered near $51 a barrel last night, after recovering from a session low of $49.66 earlier. US crude was also up 70 cents at $48.63, after rallying earlier to $49.31.
Brent crude was being traded at below $50 a barrel for the first time since 2009 today as the rout in global oil prices continued. The industry benchmark has slumped from $116 a barrel in June,driven by a glut in supply and shrinking demand due to fears over the outlook for world economic growth. Brent was down by another 2% in trading today, putting more pressure on the shares of FTSE 100 Index heavyweights BP and Royal Dutch Shell.
The plummeting price of oil means no more trout ice cream. Coromoto, a parlor in Merida, Venezuela, famous for its 900 flavors, closed during its busiest season in November because of a milk shortage caused by the country’s 64% inflation rate, the world’s fastest. That’s the plight of an oil-producing nation. At the same time, consuming countries like the US are taking advantage.
Oil extended losses below $48 a barrel amid speculation that US inventories will expand, deepening a global supply glut that’s driven prices to a five-year low. Futures declined for a fourth day. Stockpiles in the world’s biggest oil-consuming country probably rose by 700,000 barrels last week, a survey showed before a government report. Oil slumped almost 50% in 2014, the most since the 2008 financial crisis, after the Organization of Petroleum Exporting Countries resisted calls to cut output as it competes with US producers.
Oil prices have tumbled to their lowest level in nearly six years as a glut in supply coincides with shrinking demand amid fears for world economic growth. The plunge looks set to prove a boon for consumers as it feeds through to lower petrol costs and depressed inflation - currently at a 12-year low of 1% and expected to fall further - but hurts the prospects of UK-listed companies. Brent crude today headed close to $51 a barrel, nearing the $50 that has not been seen since May 2009.