Oil prices rise due to lower US drilling activity
Business & Economy section is provided to you by Jiji.ng — #1 Nigerian online marketplace
Visit website

Oil prices rise due to lower US drilling activity

- The prices of oil has risen to 69.67 dollars per barrel

- This increase in the price of oil has been attributed to the lowered drilling activities by the United States of America

- It was gathered that US drillers cut seven oil rigs in the week to March 29 bringing the total count down to 797 RIG-OL-USA-BHI

Oil prices rose on Monday, April 2, lifted by a drop in U.S. drilling activity as well as by expectations that the United States could re-introduce sanctions against Iran.

U.S. WTI crude futures were at 65.18 dollars a barrel at 0025 GMT, up 24%, or 0.4%t, from their previous settlement. Brent crude futures were fetching 69.67 dollars per barrel, up 33%, or 0.5%

Stephen Innes, head of trading for Asia/Pacific at futures brokerage OANDA in Singapore, said oil markets remained nervous about “whether or not the US administration will scrap or maintain the fragile nuclear deal with Iran.”

READ ALSO: Presidency reacts as Obasanjo calls Buhari's administration incompetent

Innes said prices were also supported by a weekly report that there was a drop in activity of drilling for new oil production in the United States.

US drillers cut seven oil rigs in the week to March 29, bringing the total count down to 797 RIG-OL-USA-BHI, General Electric Co’s Baker Hughes energy services firm said in its closely followed report last Thursday.

It was the first time in three weeks that the rig-count fell.

READ ALSO: EFCC invites Okonjo-Iweala to explain withdrawal of $250m from Abacha's loot

Baker Hughes published its North American rig count report on Thursday, one day earlier than usual, due to the Good Friday holiday on March 30.

Oil prices have generally been supported by supply restraint led by the Organisation of the Petroleum Exporting Countries (OPEC) and Russia, which started in 2017 in order to rein in oversupply and prop up prices.

Liquidity on Monday will be low as many countries, especially in Europe, will still be on Easter holiday.

Legit.ng earlier reported that the price of crude oil had jumped above $65 per barrel after the shutdown of the Forties North Sea pipeline knocked out significant supplies from a market.

It was gathered that the supplies were already tightening due to OPEC-led production cuts.

Also, Britain’s Forties oil pipeline, the country’s largest at a capacity of 450,000 barrels per day (bpd), shut down on Monday, December 11, after cracks were revealed.

Meet Sunny Ofehe, the new face of Niger Delta development - Legit.ng TV

Source: Legit.ng

Mailfire view pixel