Oil rose for a third straight week as demand remained resilient, while supplies are frayed across the OPEC+ coalition and beyond.
West Texas Intermediate for February delivery fell US$0.56, or 0.7 percent, to US$78.90 a barrel on Friday, but gained 5 percent for the week.
Brent crude for March delivery fell US$0.24 to US$81.75 a barrel, also rising 5 percent this week.
Kazakhstan’s biggest oil producer has altered output at the giant Tengiz field following protests, while Libyan production has also been crimped.
However, restrictions on access to restaurants and gyms from Germany to Hong Kong were a reminder that the Omicron variant of SARS-CoV-2 could still curb demand.
“The oil market remains very tight and seems like it will go higher,” said Ed Moya, Oanda Corp’s senior market analyst for the Americas. “But energy traders are concerned curbs across Europe and Asia could threaten the short-term demand outlook.”
This week, OPEC+ announced its plan to stick with a scheduled output boost of 400,000 barrels a day for next month.
However, the group is unlikely to meet the threshold as some members have struggled to achieve their targets in previous months. Production in Libya has declined amid militia unrest, while Russia also failed to boost volumes last month. Nigeria, beset by disruptions at loading facilities, pumped just 1.35 million barrels a day of crude last month.
Oil futures have firmed into a bullish backwardation structure, signaling growing supply tightness.
“The recent oil-price rally has clearly been supported by the supply side, with production issues in Nigeria, a deep-freeze disrupting oil flows in Canada and northern US, and disappointing production numbers from Brazil, Russia and OPEC” wrote Helge Andre Martinsen, senior oil analyst at DNB Bank ASA in Oslo.
The operator of Kazakhstan’s Tengiz field, known as TCO, declined to provide further details on the size of the output adjustment, but it said that production operations were continuing.
TCO is a joint venture led by Chevron Corp that pumps about one-third of the nation’s oil.
A deep freeze in Canada and the northern US has also disrupted oil flows this week. That has coincided with shrinking US crude inventories, which have declined every week since November.
Meanwhile, Canada’s oil sands producers were able to export a record amount of crude to overseas markets thanks to a new link to the US Gulf Coast.
The recent reversal of Marathon Pipe Line Inc’s Capline pipeline is sending oil sands crude produced in landlocked Alberta to export terminals on the Gulf Coast where it can be shipped to other countries.
Exports to Asia were at their highest ever, with India the leading destination by far, followed by China and South Korea, oil analytics firm Kpler said.
Additional reporting by AP
The domestic unit of the Chinese-owned, Dutch-headquartered chipmaker Nexperia BV will soon be able to produce semiconductors locally within China, according to two company sources. Nexperia is at the center of a global tug-of-war over critical semiconductor technology, with a Dutch court in February ordering a probe into alleged mismanagement at the company. The geopolitical tussle has disrupted supply chains, with some carmakers reportedly forced to cut production due to chip shortages. Local production would allow Nexperia’s domestic arm, Nexperia Semiconductors (China) Ltd (安世半導體中國), to bypass restrictions in place since October on the supply of silicon wafers — etched with tiny components to
Singapore-based ride-hailing and delivery giant Grab Holdings Ltd has applied for regulatory approval to acquire the Taiwan operations of Germany-based Delivery Hero SE's Foodpanda in a deal valued at about US$600 million. Grab submitted the filing to the Fair Trade Commission on Friday last week, with the transaction subject to regulatory review and approval, the company said in a statement yesterday. Its independent governance structure would help foster a healthy and competitive market in Taiwan if the deal is approved, Grab said. Grab, which is listed on the NASDAQ, said in the filing that US-based Uber Technologies Inc holds about 13 percent of
Taiwan is open to joining a global liquefied natural gas (LNG) program if one is created, but on the condition that countries provide delivery even in a scenario where there is a conflict with China, an energy department official said yesterday. While Taiwan’s priority is to have enough LNG at home, the nation is open to exploring potential strategic reserves in other countries such as Japan or South Korea, Energy Administration Deputy Director-General Chen Chung-hsien (陳崇憲) said. While the LNG market does not have a global reserve for emergencies like that of oil, the concept has been raised a few times —
Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) yesterday received government approval to deploy its advanced 3-nanometer (3nm) process at its second fab currently under construction in Japan, the Ministry of Economic Affairs said in a news release. The ministry green-lit the plan for the facility in Kumamoto, which is scheduled to start installing equipment and come online in 2028 with a monthly production capacity of 15,000 12-inch wafers, the ministry said. The Department of Investment Review in June 2024 authorized a US$5.26 billion investment for the facility, slated to manufacture 6- to 12nm chips, significantly less advanced than 3nm process. At a meeting with
RSS