Oil prices decline
By Sara Israfilbayova
World oil prices fell on Monday within 2.5 percent, continuing to win back news of a possible softening of the terms of the OPEC + deal and U.S. statistics on drilling rigs.
Brent futures fell by 1.74 percent, to $75.14 a barrel, U.S.
West Texas Intermediate (WTI) crude futures eased by 2.45 percent,
to $66.22 a barrel, RIA Novosti reported.
Russian Energy Minister Alexander Novak said at the St. Petersburg
International Economic Forum on May 25 that a gradual increase in
oil production under the OPEC+ agreement could begin in the third
quarter of this year, if such a decision is adopted. Later, Novak
added that the countries of the deal would work out options for
mitigating production restrictions within a month, while one of the
options is to reach the production levels that were at the signing
of the agreement.
The cost of oil is also facilitated by data on the dynamics of the number of drilling rigs in the United States. According to the U.S. oil and gas service company Baker Hughes, a GE Company (BHGE), for the week ended on May 25, the number of drilling rigs in the U.S. increased by 13, or 1.2 percent - to 1,059. In annual terms, the number of drilling rigs increased by 151, or 1.2 times. The number of oil drilling rigs increased by 15 pieces, or 1.8 percent, to 859 units per week, while gas production fell by two, or by 1 percent, to 198 units.
OPEC and non-OPEC producers reached an agreement in December 2016 to curtail oil output jointly and ease a global glut after more than two years of low prices. OPEC agreed to slash the output by 1.2 million barrels per day from January 1.
Non-OPEC oil producers such as Azerbaijan, Bahrain, Brunei, Equatorial Guinea, Kazakhstan, Malaysia, Mexico, Oman, Russia, Sudan, and South Sudan agreed to reduce output by 558,000 barrels per day starting from January 1, 2017.
OPEC and its partners decided to extend its production cuts till the end of 2018 in Vienna on November 30, as the oil cartel and its allies step up their attempt to end a three-year supply glut that has savaged crude prices and the global energy industry.
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Sara Israfilbayova is AzerNews’ staff journalist, follow her on Twitter: @Sara_999Is
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