Oil market experiences another volatile week | Sunday Observer

Oil market experiences another volatile week

18 February, 2018

On Friday, Brent crude was priced around US$65 with WTI holding above US$61 a barrel.

Another volatile week on the global markets had analysts and investors questioning their next step.

Leading oil producers held fast on their commitment to the OPEC, non-OPEC production cuts and in early trading on Friday, Brent crude was priced around US$65 with WTI holding above US$61 a barrel.

The OPEC Secretary General, Mohammad Barkindo had another busy week, as he continues to deliver the message of sustained producer unity.

Need for new investment in oil industry

Speaking in Cairo at the Egypt Petroleum Show, EGYPS 2018, he emphasised the need for a focused return of investment to the oil and gas industry.

He highlighted the market downturn that occurred in mid-2014 as the main reason we saw “a severe dent in industry budgets.”

In his address to a small group of key energy players in Riyadh later in the week, he re-emphasised this point reminding those in attendance that “exploration and production spending fell by a massive 27 percent in both 2015 and 2016, with nearly one trillion dollars in investments frozen or discontinued.”

Speaking at the annual gathering of OPEC, the International Energy Agency and the International Energy Forum, Barkindo said he was optimistic about the return of capital to the industry but added that levels are not back to what they used to be and he cautioned, “more short-cycle rather than long-cycle projects, which are vital to future industry growth.”

Production cuts hold strong

The Saudi Arabia oil minister, Khalid Al Falih was also in Riyadh and he said he was sure the OPEC, non-OPEC cuts would hold strong, even if it meant tightness in the market later in the year.

OPEC’s secretary general said he had commitment from Russia’s president Vladimir Putin not to abandon the deal with OPEC, even as crude prices rise.

The oil price has increased by about 60 percent since last June.

. - Proactive Investors 

Comments