By Justice Derefaka
Oil was up 2% on Monday on tighter crude supplies from major producers and as coronavirus lockdowns kept easing despite a record rise in cases globally.
Prices got a boost from a plummeting U.S. and Canadian oil rig count, an indicator of future supply, which fell to a new low last week, said Andy Lipow, president of consultants Lipow Oil Associates.
The reopening of U.S. states and countries around the world following business closures and stay-at-home orders caused by the novel coronavirus, also helped oil rally, said Gene McGillian, vice president of market research at Tradition Energy in Stamford, Connecticut.
“Even though there seems to be more worries about COVID, the market continues to move higher on the expectations that things are getting back to normal,” McGillian said.
Both Brent and U.S. contracts rose about 9% last week, supported by a recovery in fuel demand as lockdowns eased and economic activity resumed.
The prospect of greater compliance by OPEC and allies, a group known as OPEC+, with coordinated production cuts to balance the market, also supported oil.
Angola’s Sonangol has allocated its August term cargoes, traders said on Monday, while the Nigerian market was awaiting official selling prices and loading programmes.
* Official selling prices for Nigerian exports for July are expected imminently.
* Loading programmes for August are also due imminently and should point to lower supply, in line with Nigeria’s commitment to cut output further following an OPEC-led supply cut deal.
* Bonny Light and Qua Iboe were last heard to be offered at dated Brent plus 50 cents to $1.00, depending on dates.
Prices are as follows:
(1)Dated Brent =$42.80/ bbl (0.105)
(2)Bonny Light =$41.79/bbl (0.085)
(3)QuaIboe =$41.79 /bbl (0.085)
(4)Forcados =$42.09 /bbl (0.085)
Stay Safe and have a wonderful week