Oil prices drop by almost 3%
As worries grow that the banking turbulence will harm the economy and trigger a recession, decreasing fuel consumption, WTI crude futures were down nearly 3% to $65 a barrel on Monday, hovering at levels last seen in late 2021.
But, the early excitement around the government-backed acquisition of Credit Suisse by UBS and the concerted effort by major central banks to increase dollar liquidity has subsided, prompting a more cautious attitude.
The top crude importer China, on the other hand, showed hints of strong demand when Unipec purchased 2M barrels of Johan Sverdrup crude from the North Sea, the first shipment to Asia in three months, according to Bloomberg.
Trading was cautious ahead of the Fed’s monetary policy announcement this week as well, with traders keeping a watchful eye out for any potential OPEC+ reaction to the selloff, even though the group is currently expected to remain in place.
As a result of the failure of Silicon Valley Bank and issues at Credit Suisse, crude oil saw its largest weekly loss in almost three years.
Tatneft of Russia increased oil production by 4.6% in 2022
According to a management document analyzing its performance until 2022, Russian oil behemoth Tatneft raised oil output by 4.6% last year to 29.1M tonnes.
Tatneft said it produced 29% more oil products last year, totaling 16M tonnes. It refined 324,000 barrels of oil daily on average, up 31% from 2021 levels.
As of now, just this corporation has reported 2022 results per international accounting norms. It was reported last week that in 2022, net profit increased 43% to 284.6B rubles ($3.68B).
In addition, according to its most recent analysis, released on Monday, the company’s free cash flow rose by 33% last year to 196.8B rubles ($2.54B).
Concentrating on the US Strategic Reserve
Early Asian trading sees an increase in oil prices after Friday’s largest weekly decline since 2023. Given that it is at its lowest level since the 1980s, ANZ analysts believe it may be a good time for the United States to restock its strategic reserve. They continue to say that the White House administration has previously stated they will not start filling it until the prices drop to USD70/bbl. However, WTI closed below this level last week.
Nevertheless, the news that UBS has agreed to purchase Credit Suisse for almost $3B boosted the market mood and allayed concerns about the banking industry. Front-month Brent increased by 0.4% to $73.28/bbl, and front-month WTI increased by 0.5% to $67.05/bbl.
