Oil Halts Uptrend as Supply Disruptions from Libya, Kazakhstan Ease
Oil prices eased early on Monday as supply disruptions in Libya and Kazakhstan eased while the wildfire spread of the Covid-19 omicron variant continues to raise demand concerns.
Crude oil market data from trading platforms obtained by MarketForces Africa shows that oil prices reversed early gain.
West Texas Intermediate crude oil for February delivery was last seen down US$0.31 to US$78.59 per barrel, while March Brent crude, the global benchmark, was down US$0.25 to US$81.50.
Prices rose to the highest since November last week after Libyan pipeline repairs and the closure of a major oilfield by a militia group cut the country’s production by more than 500,000 barrels per day.
Libya’s oil minister said the country’s output is now around 900,000 barrels per day, down from the around 1.3-million bpd it averaged in 2021.
Production is also returning to normal at Kazakhstan’s largest oilfield after protests spurred by a fuel price hike abated in the central Asian country, Chevron, which operates the field said.
The additional volumes may ease concerns oversupply as the Organisation of Petroleum Exporting Countries and allies (OPEC+) continues to raise quotas by 0.4-million barrels monthly.
Though some members have been unable to meet their targets. U.S production is also rising, averaging 11.8-million barrels in early January, up by 0.8-million bpd from a year earlier.
“The tailwind lent to oil prices by supply concerns should therefore abate, which suggests that prices will fall this week,” Commerzbank analyst Carsten Fritsch said in a note.
The latest Covid-19 wave is also raising demand concern, as Sweden became the latest country to introduce new restrictions to halt the spread of the omicron variant.
Meanwhile China is battling an outbreak ahead of next month’s Winter Olympics. # Oil Halts Uptrend as Supply Disruptions from Libya, Kazakhstan Ease
