World Oil Prices Jump Following OPEC Meeting

Indigenous oil and gas companies are coming of age – Meka Olowola

In addition, the number of rigs operating in U.S. oil fields fell by four rigs to a total of 744 rigs this week, according to data released by oilfield services firm Baker Hughes on Friday (9/22).

He added that if a meeting is needed for the cartel to decide whether to extend the cuts, "we'll arrange it". Currently, OPEC and NON-OPEC compliance is above 100% capping off its best behavior ever. That hedging will help lock in revenue and underpin growth in shale production next year, even if oil prices slip again.

The Opec meeting last week provided a few positive headlines but fell short of any actual announcements.

In May 2017, at the meeting in Vienna, the countries extended the agreement until April 2018, maintaining the previous quotas for all participants. Kachikwu said Nigeria would remain below that cap and insisted he supports the OPEC deal.

The Russian minister said ministers would also discuss monitoring exports, although he said the main focus was still on production.

This potential loss, combined with 1.8 million bpd of output reductions by Opec and non-Opec producers, raised concerns of tighter supply. "Compliance was at 94% in July".

Iran is another OPEC observer who is repeating the increasingly familiar mantra that begins, "OPEC's cuts are working, but.": in its case, the "but" that Islamic republic wants addressed is rising input from Libya and Nigeria.

Thomson Reuters, the parent of Reuters news, competes with Platts and Argus in providing news and information to the oil market. "The information reason - a series of hurricanes and their consequences in the U.S. - has already exhausted itself, and other information reasons for raising oil prices are not expected now", he explained.

United States oil rig count is down by 12 so far in Q3 compared to sharp increases in the first half of this year. The goal of the agreement is to reduce global oil reserves to the average level of the last five years.

Resurgent production from USA shale oil producers, who use advanced drilling methods, has played a major role in delaying the market rebalancing. The U.S. government on Wednesday announced a build of 4.6 million barrels for the week ended September 15.

Over 8 months that the agreement is operating, the surplus of global oil reserves decreased by 168 million barrels and now stocks exceed the five-year standard by only 170 million barrels, according to Novak. This caused prices to fall as low as $29 in January 2016.

The price of oil has fallen back on Tuesday after earlier hitting a two-year high. He also threatened to cut a vital Kurdish oil pipeline and stop vehicles crossing Turkey's border.

The WTI curve has also flattened in the last couple of weeks indicating a bullish market. "We expect a strong pick up in crude demand in the second half of the year, by 2mb/d, year on year".

Puerto Rico was devastated by the impact of Irma and Hurricane Maria, which hit the US island territory as a Category 4 storm. U.S. refinery utilization rebounded to 83.2 per cent last week after dropping to 77.7 per cent after the Hurricane struck.

The large concentration of hedge fund long positions in gasoline, heating oil and gasoil could presage a sharp correction at some point if fund managers try to realise some of their profits. More US refineries returning to normal operations will keep prices bid up in the coming days.

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