Oil Prices Remain Stable as Supply Fears Weigh
On Thursday, oil prices remained stable as expectations of weaker demand and a strong US currency ahead of a potentially hefty interest rate hike offset supply concerns.
The International Energy Agency predicted that oil demand growth would slow in the fourth quarter. The dollar remained near recent highs, buoyed by expectations that the Federal Reserve of the United States will continue to tighten policy.
At 0855 GMT, Brent crude was down 10 cents, or 0.1%, to $94.01 per barrel. West Texas Intermediate crude in the United States lost 44 cents, or 0.54%, to $88.14.
Crude had plummeted significantly since reaching near-all-time highs in March when Russia’s invasion of Ukraine exacerbated supply fears, which were exacerbated by the threat of a recession and decreased demand.
Oil was under pressure from a strong dollar, which makes dollar-denominated commodities more costly for holders of other currencies, ahead of a Federal Reserve meeting next week, which could result in a 100 basis point rise in interest rates.
According to statistics released on Wednesday, US petroleum stockpiles grew by 2.4M barrels more than projected, buoyed once again by continuous withdrawals from the Strategic Petroleum Reserve, part of a program set to finish next month.
Saudi Arabia, the Second-Biggest Oil Supplier to India
Saudi Arabia surpassed Russia to become India’s second-largest oil supplier after a three-month hiatus. Still, Iraq kept the top rank in August, according to statistics from industry and trade sources.
India, the world’s third-largest oil importer and consumer imported 863,940 barrels per day (BPD) of crude from Saudi Arabia, up 4.8% from the previous month. At the same time, purchases from Russia declined 2.4% to 854,950 BPD.
Despite Saudi gains, India’s share of oil from the OPEC fell to 59.8%, the lowest in at least 16 years, as the country reduced African imports. Following Moscow’s invasion of Ukraine in late February, India has surpassed China as Russia’s second-largest oil consumer.
The two countries, eager to get raw resources at lower prices than other suppliers, are seen as mitigating the impact of Western sanctions on Moscow.
India’s crude oil imports fell to a five-month low of 4.44M BPD in August, down 4.15% from July, due to maintenance at some refineries.
Higher Caspian Sea oil consumption, primarily from Kazakhstan, Russia, and Azerbaijan, has reduced India’s purchases from Africa and other countries.
According to the report, African oil’s share fell to 4.25% in August, while Latin America’s portion plummeted to 5.35% from around 7.75%.
According to the data, Russian oil accounted for around 16% of India’s total imports in April-August, at 757,010 BPD, compared to 20,012 bpd a year earlier, or a 0.55% share.
Norway Collaborates with The EU for A Stable Gas Market
Norway will cooperate with the EU to create a more stable gas market since rising prices are not in the best interests of the Nordic country, Prime Minister Jonas Gahr Stoere said on Thursday.
Stoere said after summoning gas companies to discuss methods to reduce the price of Norwegian gas sold to Europe, including the possibility of long-term supply contracts.
These huge gas price rises are not in the best interests of Norway, Stoere told reporters following the meeting. Norway is presently the leading provider of piped gas in Europe.
Energy corporations stated that they would be happy to sign long-term contracts if they knew who their counterparties would be.
At today’s prices, it’s too big a risk for most private players to assume, Aker BP Chair Oeyvind Eriksen told reporters after the meeting. Aker BP is the second-largest gas producer in Norway.
So it’s partially an issue of price systems and part of how states and businesses can collaborate to solve this significant problem.