332 Views

Supply Glut Crashes Oil Price To Under $50

World oil prices dropped to under $50 on Monday, following supply glut concerns.

The development has reversed the gains of last week.

Yesterday, Brent North Sea crude for delivery in October slumped by $1.45 compared with Friday’s close to trade at $49.43 a barrel.

US benchmark West Texas Intermediate for September delivery shed $1.26 to $47.26 a barrel.

“The oil market is on course for its biggest daily loss in over a month,” oil brokers PVM said in client note.

“Adding to global oil product glut woes are figures showing that Chinese exports of gasoline and diesel surged in July from a year ago,” it said, adding that reports that Iraq will resume crude oil exports from its northern fields heaped further pressure on prices.

In addition, a rebel group in Nigeria has announced a conditional ceasefire and agreed to hold talks with the country’s government following months of attacks on key oil and gas facilities.

In a weekend message posted on the Niger Delta Avengers’ website, the group said it would “observe a cessation of hostilities”, so long as the country’s ruling party stops what it called harassment of innocent civilians.

Weighing also on dollar-denominated crude was a firmer greenback, traders said.

Oil’s slide comes after the commodity entered a bull market last week — after rising more than 20 percent from recent lows below $40 a barrel.

ALSO READ  Aliko Dangote, 2 Others To Takeover Peugeot Assembly Plant Worth $49m in Nigeria

But gains were chipped after Bloomberg News reported that Iraq, OPEC’s second-biggest producer, will increase exports by about five per cent after an agreement to resume shipments from three oil fields.

“Oil is buffeted by US dollar gains and news that Iraq plans to boost its exports, stoking fears that the supply glut will worsen,” said Bernard Aw, an analyst with IG Markets in Singapore.

“Fresh developments about an OPEC discussion on a possible output freeze next month could provide a base for oil prices,” he told AFP.

Both main oil contracts surged last week as it emerged that the OPEC producers club and its rivals will meet next month, with speculation they could discuss ways to tackle an oversupplied market.

However, despite the rally in oil prices there are doubts a deal to freeze output around current levels would be reached.

“The stars remain misaligned for an OPEC/non-OPEC freeze agreement, but it is beneficial for producers to talk,” British bank Barclays said in a market analysis.

“Oil prices will likely experience another short-term dip in the coming weeks… before more sustainably moving to average $50” in the fourth quarter, it added.

 

Source: Leadership.ng

Get the best viral stories straight into your inbox!

Don't worry, we don't spam

Leave a Comment

Your email address will not be published.

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Latest Posts

Father Mbaka Reveals What Will Happen To Buhari-led APC Government
Politics
16 views
Politics
16 views

Father Mbaka Reveals What Will Happen To Buhari-led APC Government

PH - July 23, 2018

The Spiritual Director, Adoration Ministry, Enugu Nigeria, Rev. Fr. Ejike Mbaka has warned President Muhammadu Buhari and members of the Federal Legislature of impending doom. The fiery…

Meet Marenikae, the Pioneer of New Music Genre “Afromerge”
Entertainment
17 views
Entertainment
17 views

Meet Marenikae, the Pioneer of New Music Genre “Afromerge”

PH - July 23, 2018

Having lived abroad and at home, Marenikae is on a quest to bridge the gap between foreigners and their understanding of African music, case in point, Afropop.…

Here’s Why You Should Eat Dinner Early
Featured
24 views
Featured
24 views

Here’s Why You Should Eat Dinner Early

PH - July 23, 2018

People who eat two hours before going to bed have a lower risk of breast and prostate cancer as opposed to those who hit the sack immediately…

JAMB Remits N7.8b To FG As Examination Surplus
Education
20 views
Education
20 views

JAMB Remits N7.8b To FG As Examination Surplus

PH - July 23, 2018

The Joint Admissions and Matriculation Board (JAMB) has remitted another N7.8 billion to the Federal Government. Its Head, Media and Information, Dr. Fabian Benjamin, made this known…

MUST WATCH: 9 Fruits And Vegetables That Contain The Most Pesticides
Food and Health
23 views
Food and Health
23 views

MUST WATCH: 9 Fruits And Vegetables That Contain The Most Pesticides

PH - July 23, 2018

Apples, strawberry and grapes are among the fruits and vegetables that contain the most pesticides. According to a research by Environmental Working Group (EWG), 97 percent of…

Saraki Denies Being Offered Oil Bloc, Nomination Tickets
Politics
27 views
Politics
27 views

Saraki Denies Being Offered Oil Bloc, Nomination Tickets

PH - July 23, 2018

The senate president, Bukola Saraki, has debunked speculations about juicy offers being made to him and his associates as part of the on-going discussions with the presidency…

Nigerians Applaud Singer Falz Over New Video On Assault
Entertainment
25 views
Entertainment
25 views

Nigerians Applaud Singer Falz Over New Video On Assault

PH - July 23, 2018

Nigerians and the Domestic and Sexual Violence Response Team (DSVRT) have lauded singer, Folarin Falana a.k.a Falz for addressing sexual violence in his latest music video. The…

Gov Ahmed Reacts To Saraki’s New Appointment
Politics
22 views
Politics
22 views

Gov Ahmed Reacts To Saraki’s New Appointment

PH - July 23, 2018

Kwara State Governor, Abdulfatah Ahmed has hailed the elevation of the Senate President, Dr Abubakar Bukola Saraki from the title of Turaki of Ilorin to Waziri of…

Veteran Nigerian Singer, 2Baba Talks Celebrity Status In New Interview
Entertainment
26 views
Entertainment
26 views

Veteran Nigerian Singer, 2Baba Talks Celebrity Status In New Interview

PH - July 23, 2018

2Baba, Nigerian singer, says his parents taught him to respect everybody despite their level in society. The veteran singer has had a lengthy career and is still…

Nigerian Rapper, MI Abaga Addresses Choc Boiz Break Up
Entertainment
17 views
Entertainment
17 views

Nigerian Rapper, MI Abaga Addresses Choc Boiz Break Up

PH - July 23, 2018

MI Abaga, rapper and record label executive, has released the video for ‘Brother’, four years after the song was recorded. ‘Brother’, which featured Nosa and Milli, was…

Researcher Links “Processed Meat” to Insomnia and Hyperactivity
Food and Health
22 views
Food and Health
22 views

Researcher Links “Processed Meat” to Insomnia and Hyperactivity

PH - July 23, 2018

A research has shown that nitrates, the chemicals used to cure meats such as beef jerky, salami, hot dogs and other processed meat snacks, may contribute to…

Food and Health
21 views

Gov Ortom’s Wife Commences Free Medical Treatment For VVF Patients In Benue

PH - July 23, 2018

Wife of Benue Governor, Mrs Eunice Ortom, has commenced free medical treatment for women suffering from Vesico-Vaginal Fistula (VVF) in the 23 local government areas of the…

Why Kizz Daniel Refused to Work with Reekado Banks on Selense – Harrysong
Entertainment
25 views
Entertainment
25 views

Why Kizz Daniel Refused to Work with Reekado Banks on Selense – Harrysong

PH - July 23, 2018

Kizz Daniel is reportedly holding a grudge against Reekado Banks and has refused to feature on any song the latter is involved in. The feud may have…

Photos from the N10million White Wedding of Olu Jacobs and Joke Silva’s Son
Entertainment
37 views
Entertainment
37 views

Photos from the N10million White Wedding of Olu Jacobs and Joke Silva’s Son

PH - July 23, 2018

Veteran Nollywood Actors, Olu Jacobs and Joke Silva’s son, Olusoji married his woman, Boma Douglas in a colorful White Wedding Ceremony. Top stars like Ufoma McDermott, Kate…

First Bank Hosts Chinese Business Forum To Deepen Intercontinental Partnerships
Business
36 views
Business
36 views

First Bank Hosts Chinese Business Forum To Deepen Intercontinental Partnerships

PH - July 23, 2018

First Bank of Nigeria Limited has organised the FirstBank-Chinese Business forum with aim of strengthening business partnerships between Nigeria and China. The bank in statement said that…

Nigeria’s Inflation Slows To Lowest Rate In 30 Months
Business
36 views
Business
36 views

Nigeria’s Inflation Slows To Lowest Rate In 30 Months

PH - July 23, 2018

Nigeria’s consumer prices rose at the slowest pace in 2 1/2 years in June as food costs climbed the least since March 2016. The annual consumer inflation…

Buhari’s Minister Fires APC Chairman, Oshiomhole
Politics
35 views
Politics
35 views

Buhari’s Minister Fires APC Chairman, Oshiomhole

PH - July 23, 2018

Minister of Labour and Employment, Dr. Chris Ngige has faulted the stand of the Chairman of the All Progressives Congress (APC), Comrade Adams Oshiomhole on the constitution…

Bayelsa Community Gets Water Project From Oando, Partners
Business
29 views
Business
29 views

Bayelsa Community Gets Water Project From Oando, Partners

PH - July 23, 2018

Oando PLC and its joint venture (JV) partners – Nigerian National Petroleum Corporation (NNPC) and Nigerian Agip Oil Company (NAOC), have provided good drinking water to the…

Loading...