| At 10:10 am Singapore time (0210 GMT), the ICE March Brent futures contract was up 31 cents/b (0.38%) from the previous close at $81.18/b, while the NYMEX February light sweet crude contract was 42 cents/b (0.54%) higher at $78.65/b. Both crude oil benchmarks had dipped by up to 1.1% overnight, shedding some gains accrued over the last three weeks, as reports of an impending return in Libyan supply and climbing COVID-19 cases worldwide weighed on prices.
Nonetheless, analysts said the overall supply-demand balance remained supportive, with inventory levels still tight and global demand set to recover further even as many countries battle a surge in COVID-19 cases driven by the highly contagious omicron variant.
Libyan oil output meanwhile is poised to recover to about 1.2 million b/d after state-owned National Oil Corp. reached an agreement with the Petroleum Facilities Guards, paving the reopening of the oil fields of Sharara, El Feel, Wafa and Hamada and the 300,000 b/d Zawiya oil terminal, Libya-based and trading sources said Jan. 10. This comes after Tengizchevroil, the operator of Kazakhstan’s Tengiz oil field, said Jan. 9 production at the field was returning to normal after disruptions caused by protests at the site. (S&P Global Platts)
A weaker U.S. dollar helped support oil prices on Tuesday, as it makes oil cheaper for those holding other currencies. A U.S. Senate committee holds hearings this week for Federal Reserve Chair Jerome Powell and vice chair nominee Lael Brainard that could provide new details about the U.S. central bank’s plans to tighten monetary policy. (S&P Platts)
Analysts pointed to OPEC supply additions running below their allowed increase under the OPEC+ pact, as some countries, including Nigeria, are not producing their agreed volumes. Libya, which is exempt from OPEC supply curbs, has been hit by pipeline maintenance work and oil field disruptions. However on Monday, production resumed at the El Feel oil field, where an armed group halted output last month. (Reuters)
OIL MARKET ROUND-UP: (Bloomberg) |
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