Oil prices change in different directions
By Sara Irafilbayova
World oil prices show a weakly multidirectional dynamics on Friday after the confident growth on July 26 on reports of Saudi Arabia’s suspension of the export of raw materials through the Bab-el-Mandeb strait.
Brent crude futures, the international benchmark for oil prices, were at $74.52 per barrel, down 0.03 percent, U.S. West Texas Intermediate (WTI) crude futures were at $69.64 a barrel, up 0.04 percent, according to RIA Novosti.
Minister of Energy, Industry and Mineral Resources of Saudi Arabia Khalid al-Falih said that the kingdom decided to suspend oil exports through the Bab-el-Mandeb strait after the attack on oil tankers in the Red Sea by Yemeni rebels. Yemeni rebels from the Ansar Allah movement (Houthis) attacked Saudi oil tankers on July 25.
According to the Energy Information Administration (EIA), about 4.8 million barrels of oil and oil products per day were transported through the Bab-el-Mandeb strait to Europe, the U.S. and Asia in 2016.
Moreover, global trade contradictions influence the oil market. Investors are concerned about the U.S. trade relations with China, especially after the agreements reached by U.S. President Donald Tramp and President of the European Commission Jean-Claude Juncker.
As a result of their meeting, the EU and the U.S. reached a number of agreements, among them work towards zeroing duties on industrial goods, the possibility of increasing the supply of LNG and soybeans from the U.S. to the EU countries.
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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