On Monday, oil prices climbed during early Asian trading, as the dollar weakened and supply concerns grew over the European Union embargo on Russian oil which is due to begin in December. The supply worries overwhelmed fears of a global economic slowdown that would stifle energy demands.
European benchmark Brent crude was up 1.3%, gaining $1.15 to $92.50 per barrel as of 00:49 GMT, after rising 0.5% Friday. US West Texas Intermediate, the US benchmark, rose 1.2%, gaining $1.05 to hit $86.16 per barrel. The front-month contract expires Tuesday.
Both contracts lost more than 1% last week as investors processed hotter than expected inflation data and an ominous earnings warning from FedEx, triggering worries that increased policy action by the Federal Reserve this week could trigger a global economic slowdown. The contracts were supported by a weakening dollar, which began to come off multi-year highs.
In China, the government reported that Covid-19 infections continued to decline, allowing further easing of Covid-19 restrictions in Chengdu, a city of 21 million, easing trader fears of a reduction in demand from the second biggest energy consumer, due to further lockdowns.
Kuwait Petroleum Corporation’s (KPC) noted that even as traders debate the future of the global economy, it is seeing no change in demand or prices. The gulf nation is currently adhering to its OPEC production quota, producing more than 2.8 million barrels per day.
Iraq’s Basrah oil terminal, which had halted operations Friday due to an oil spill, resumed full loading and exporting operations on Saturday, according to Basrah Oil Company.
Shell is expected to stand down its 200,000 barrels per day Bonga deep water storage and offloading vessel in Nigeria, for scheduled maintenance n October, according to a company spokesperson on Sunday.
In the US, energy firms added oil and natural gas rigs for the first time in three weeks, signaling more supplies will be on the way. Total oil and rig count rose by four to 763 in the week ending September 16th, the highest number since August, according to data from energy services firm Baker Hughes Co.
