Oil Industry News on August 30
Oil industry always attracts attention as oil prices are part of daily life, which affects billions of people around the world. In this situation it not surprising that trade war between the U.S. and China remains one of the most debated topics. As it has the potential to influence the oil prices and oil industry in general. However, there are other important issues as well. For example, the regional tensions in the Middle East.
Oil prices decreased on Friday. The price of Brent crude dropped by 23 cents or 0.4% to $60.85 a barrel. Moreover, the price of West Texas Intermediate (WTI) crude futures also fell by 40 cents or 0.7% to $56.31 a barrel. However, the price of Brent crude still managed to increase to achieve the best weekly gain since early July. The WTI crude futures price increased by 4% since the beginning of the week.
There are multiples factors which determine oil prices.
Oil industry on Friday
Good news for the oil industry is that on Thursday China and the U.S. hinted that they are ready to resume the trade talks. Any positive news regarding the trade war might boost oil prices.
The global economy is slowing down, and this might further decrease oil prices. In this situation, a possible agreement between the U.S. and China will be a huge step forward for the oil industry.
The trade war is a big issue but there other exciting news as well. For example, Hurricane Dorian is getting closer to Florida. This might disrupt the oil production in the Gulf of Mexico if the hurricane is going to enter the gulf.
According to forecasts, Dorian will reach the Atlantic coast of Florida this weekend. Moreover, there is a chance that hurricane might enter the eastern part of the Gulf of Mexico next week.
Based on the National Hurricane Center’s data, the force of hurricane will increase to category 4. It means that it Dorian will become a highly dangerous hurricane.
A joint project of China and the Philippines
Another interesting and quite unusual news is from Asia. China has territorial claims in the South China Sea. It claims that nearly 90% of the South China Sea is part of China. However, neighbors including the Philippines disagree with China’s position.
In this situation, any cooperation between the countries might seem highly unlikely. Nevertheless, after Rodrigo Duterte became the president situation changed and countries started to cooperate on a number of issues. According to the Philippines’ envoy to China Chito Sha. Romana said that sides would discuss the many topics, including oil production.
China and the Philippines might reach an agreement to start drilling in the South China Sea. As mentioned above, this is a very interesting situation. The cooperation between the countries which disagree regarding the boundaries.
Oil prices decreased on Friday. However, as China and the U.S. are willing to restart the trade talks, this might increase the demand for oil. It means that oil prices might reach more than $60 a barrel.
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