Oil prices plunged in early trading on Friday on news that OPEC and its partners, including Russia, are considering a loosening of their production limits (more below). Both WTI and Brent fell by more than 3 percent Friday morning.

OPEC and Russia could raise production. Saudi Arabia and Russia are in discussions about raising their production limits, perhaps adding as much as 1 million barrels per day to the market. The group could announce a change in Vienna next month. The steep losses from Venezuela meant that OPEC’s compliance with the cuts surpassed 150 percent last month. The idea would be to bring compliance back down to 100 percent, which would mean allowing members to produce more to offset Venezuela’s declines. Nothing is finalized yet and the talks will continue for the next few weeks. Oil prices sank on the news.

U.S. oil exports rising, but infrastructure faces constraints. U.S. oil exports hit a new record at 2.6 million barrels per day two weeks ago, but have dipped since then. Most analysts see exports continuing to rise, particularly with WTI trading at a steep $8-per-barrel discount relative to Brent. However, there are concerns that U.S. port infrastructure won’t be able to handle much higher levels of exports. Export capacity data isn’t tracked and the exact capacity is not known, although it is thought to be around 3.5 MB/d. As of now, the Louisiana Offshore Oil Port (LOOP) is the only Gulf Coast port that can handle very large crude carriers (VLCCs). “So far, export capacity is keeping pace, but we are walking a tightrope,” Bernadette Johnson, vice president at DrillingInfo, told Reuters.

BP cuts jobs. BP (NYSE: BP) said it will slash 3 percent of its workforce in its upstream unit this year, eliminating more than 500 positions. The oil giant said the move was done in the name of efficiency and competitiveness.

U.S. shale growth to disappoint. Industry veteran Mark Papa, CEO of Centennial Resource Development (NASDAQ: CDEV) and former head of EOG Resources (NYSE: EOG), says that the growth projections for U.S. shale are overly optimistic. Papa says growth disappointed last year and would continue to undershoot expectations, largely because the best sites have already been drilled. In the Eagle Ford and the Bakken “my estimate is that about 70% of the good quality drilling locations have already been drilled,” Papa said, according to S&P Global Platts. “So you’re left … with Tier 2 and Tier 3 quality geologic locations and there’s a really steep drop-off in the amount of oil you get per well with those locations.”

Peak oil demand to erase $19 trillion in oil income. The adoption of 240 million electric vehicles by 2040 will cause oil demand to peak by the mid-2020s, which will destroy $19 trillion in income, according to Aurora Energy Research Ltd. Aurora’s “analysis points to a possible energy future of mass electrification, digitization, and new technologies, in which the rise in electric vehicles and continued improvements in fuel efficiency lead to peak oil demand occurring in the mid-2020,” Richard Howard, head of research at Aurora, said in the report. Ultimately, the displacement of around 8 million barrels per day could cause oil prices to fall to as low as $32 per barrel by 2040.

NJ bails out nukes. New Jersey approved a bailout of its struggling nuclear power plants. Ratepayers will essentially subsidize the nuclear plants, operated by Exelon Corp. (NYSE: EXC), by about $300 million a year. The support for nuclear comes after New York and Illinois previously passed similar measures to rescue their nuclear power plants.

Large consumers step up oil hedging. With Brent oil near $80 per barrel, large industrial consumers, such as airlines and shipping companies, have increased their hedges, locking in oil for the next year or so, fearful of further price increases. “Consumers are hedging, which is supporting the back end of the Brent curve,” Thibaut Remoundos, founder of Commodities Trading Corp., told Bloomberg.

UBS: $100 oil possible. Investment bank UBS says that a price spike to $100 per barrel is possible, which should be worrying because it could trigger an economic recession. “Now that we are getting closer to $100/bbl the net impact of higher oil prices is again becoming a net negative,” UBS said in a research note. “The global sweet spot — where oil prices may have positively contributed to global growth — seems to be somewhere between $50/bbl and $70/bbl.”

ExxonMobil to slash methane by 15 percent. ExxonMobil (NYSE: XOM) said that it would voluntarily cut methane emissions by 15 percent by 2020 in an effort to reduce its impact on climate change. More and more oil companies are offering voluntary cuts to head off regulatory action.

EU settles antitrust case with Gazprom. The European Union officially settled a suit this week against Russian gas giant Gazprom, filed back in 2015, over anticompetitive behavior. Last year, Gazprom accepted changes to the way it conducts business in the EU, including allowing for the reselling of gas across borders and changes to pricing that will prevent the company from gouging individual countries who lack alternative supplies. “Gazprom won’t be able to play hardball,” Jonathan Stern, an analyst in the gas program at the Oxford Institute for Energy Studies, told the New York Times. Still, countries in Eastern Europe believe Gazprom got off easy.

Canadian oil exports to U.S. Gulf Coast surpass Venezuela’s share. Canada has long supplied the U.S. Midwest with heavy oil, but more Canadian oil is heading to the Gulf Coast. Canada’s oil exports to the U.S Gulf Coast topped that of Venezuela for the first time on a monthly basis. Both countries ship heavy oil to Gulf Coast refiners, but Venezuela’s losses mean that Canadian oil has become more important.

SOURCE: https://brandspurng.com/opec-sends-oil-prices-crashing-oilprice-report/

interesting

this is sad.... I don't even understand the news....

what

Na wa

This is bad news for Nigeria. When we are about recovering!

Oh noooo.....

yumubelek:
this is sad.... I don't even understand the news....

Eh ya!!

More lamentations to follow soon

BMC your salary go reduce o.

Meanwhile

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Not a good news for us just when our economy gradually being revived..

ajealadick:
This is bad news for Nigeria. When we are about recovering!

About to? We would keep hearing 'about to' until the government decides to look away from oil as our 'sole' source of income.

post=67946620:

Eh ya!!

Thanks for the consolation, sorry I mean transmission of sympathy....

OPEC and Russia could raise production. Saudi Arabia and Russia are in discussions about raising their production limits, perhaps adding as much as 1 million barrels per day to the market. The group could announce a change in Vienna next month. The steep losses from Venezuela meant that OPEC’s compliance with the cuts surpassed 150 percent last month. The idea would be to bring compliance back down to 100 percent, which would mean allowing members to produce more to offset Venezuela’s declines. Nothing is finalized yet and the talks will continue for the next few weeks. Oil prices sank on the news.

So Saudi Arabia is now OPEC
OPEC is a body comprising different oil producing nations, so when two are in talks that means the whole organisation is in talks

OPEC shaaa


In other news
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will this affect the price of Garri in market?

ajealadick:
This is bad news for Nigeria. When we are about recovering!

No bad news for the ruling class. Whether oil prices rise or fall, our poor living standard still persist

yumubelek:


Thanks for the consolation, sorry I mean transmission of sympathy....

Lol, you are very welcome!

OPEC and Russia are trying to stop the renewed production of shale oil.

With oil almost stabilizing at over $70, will encourage the production of shale oil which production is around $60. And the only way to control this is to create a supply surplus which in turn will drive down the price and discourage shale oil production.

Zonacom:

No bad news for the ruling class. Whether oil prices rise or fall, our poor living standard still persist

Hmmmm, true words of an elder!

God save Nigeria.

Trying to ease US shale oik out of the market. . .bad news for Nigeria though

But I think they prepared the budget under the assumption that oil prices would be at $45/barrel. . .how are we sure the surplus amounts haven't been looted (meaning this news has no effect on us, its just had news for the yam eaters)

Even if it booms, na thief dem go still thief the money for naija.

I'm focusing on Lead for now. I will soon attend to Crude

It's a good news. May be when oil price falls to as low as $3/pb, our senseless and lazy leaders will start to think outside the box. I'm tired of hearing diversification bullshiit all the time.

Lobatan!

Zonacom:

No bad news for the ruling class. Whether oil prices rise or fall, our poor living standard still persist

The bad part is when the ruling class are slave masters. We need more leaders than rulers.

nawa oo, and the guy finally kill his girl friend, no hope for this country again..

Another excuse for Nigeria government.

ajealadick:
This is bad news for Nigeria. When we are about recovering!

I thought that Buhari and APC said that our recovery is due to diversification away from Niger Delta oil? That groundnut oil, cotton, shea butter and other exports are contributing a lot more to the federation account.
I hope that you are not suggesting that Buhari and APC told us lies

all these weeks that oil price has been high we have not heard the APC govt telling us about it



but when it goes to 30$ now, they will be singing it daily like hymn

In DMX voice:


HERE WE GO AGAIN!!

Oil prices being high is good bt being 2 high has its negative effects. Whichever case we still have to import the refined products and pay scam subsidy so? No major advantages to the masses and the oil mogul keeps making his money. The beneficiaries are Govt and marketers