Oil rose in thin trading ahead of the US Independence Day long weekend as export disruptions in Libya exacerbated global supply concerns.
West Texas Intermediate for July delivery rose 2.52 percent to US$108.43 a barrel, posting a slight weekly gain of 0.75 percent after declining the previous two weeks.
Bent crude for August delivery rose 2.38 percent to US$111.63 a barrel, but dropped 0.44 percent from a week earlier.
Photo: Reuters
Production from OPEC last month dropped by 120,000 barrels a day — the second straight month of declines, a Bloomberg survey found.
Libyan exports have fallen to about one-third of last year’s level after a worsening political crisis prompted the suspension of shipments from two of the nation’s biggest ports.
“Crude prices are finishing the week on a high note as Libya’s political crisis is leading to a steep drop with oil exports. We’ve seen this movie before, and a tight oil market and force majeure at key ports should provide underlying support for oil prices,” Oanda Corp senior market analyst Ed Moya said.
Friday’s rebound comes after crude ended last month down 8 percent from a month earlier as investors fretted over a potential global slowdown.
Oil has increased enough to alarm US President Joe Biden, who is pushing for cheaper gasoline at home, while spearheading efforts to get producers in the Middle East to boost crude output.
Within OPEC, erratic exporter Nigeria drove the loss, with output slumping to a record low. Yet even Saudi Arabia — which Biden is to visit this month — failed to deliver its promised increase. Nigeria’s output dropped by 100,000 barrels per day to 1.2 million per day, the lowest since the country joined the ranks of major producers, data compiled by Bloomberg showed.
Risk of weaker fuel exports is also emerging in India after the government on Friday increased levies on shipments of gasoline and diesel as part of a drive to control a worsening currency deficit. India is a major global fuel supplier and a drop in sales could further tighten markets that have been reeling from reduced Russian shipments.
Still, the market for real crude barrels remains firm. Premiums for North Sea oil remains strong, while crude from Angola is selling fast as European refiners buy more cargoes with supply drying up from some of the continent’s biggest supplies.
The scarcity is highlighted in crude’s futures curve remaining backwardated, where near-term contracts are more expensive than those for later delivery.
Traders are likleyscrutinizing the next moves by OPEC and its allies. While the group this week ratified an oil-production increase for next month, it left the more-pressing issue of future output levels unresolved.
Meanwhile, US demand remains robust as a record number of drivers are expected to hit the road for the long weekend, buttressing gasoline consumption.
Additional reporting by staff writer
FALLING BEHIND: Samsung shares have declined more than 20 percent this year, as the world’s largest chipmaker struggles in key markets and plays catch-up to rival SK Hynix Samsung Electronics Co is laying off workers in Southeast Asia, Australia and New Zealand as part of a plan to reduce its global headcount by thousands of jobs, sources familiar with the situation said. The layoffs could affect about 10 percent of its workforces in those markets, although the numbers for each subsidiary might vary, said one of the sources, who asked not to be named because the matter is private. Job cuts are planned for other overseas subsidiaries and could reach 10 percent in certain markets, the source said. The South Korean company has about 147,000 in staff overseas, more than half
Taipei is today suspending its US$2.5 trillion stock market as Super Typhoon Krathon approaches Taiwan with strong winds and heavy rain. The nation is not conducting securities, currency or fixed-income trading, statements from its stock and currency exchanges said. Yesterday, schools and offices were closed in several cities and counties in southern and eastern Taiwan, including in the key industrial port city of Kaohsiung. Taiwan, which started canceling flights, ship sailings and some train services earlier this week, has wind and rain advisories in place for much of the island. It regularly experiences typhoons, and in July shut offices and schools as
TECH PARTNERSHIP: The deal with Arizona-based Amkor would provide TSMC with advanced packing and test capacities, a requirement to serve US customers Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) is collaborating with Amkor Technology Inc to provide local advanced packaging and test capacities in Arizona to address customer requirements for geographical flexibility in chip manufacturing. As part of the agreement, TSMC, the world’s biggest contract chipmaker, would contract turnkey advanced packaging and test services from Amkor at their planned facility in Peoria, Arizona, a joint statement released yesterday said. TSMC would leverage these services to support its customers, particularly those using TSMC’s advanced wafer fabrication facilities in Phoenix, Arizona, it said. The companies would jointly define the specific packaging technologies, such as TSMC’s Integrated
An Indian factory producing iPhone components resumed work yesterday after a fire that halted production — the third blaze to disrupt Apple Inc’s local supply chain since the start of last year. Local industrial behemoth Tata Group’s plant in Tamil Nadu, which was shut down by the unexplained fire on Saturday, is a key linchpin of Apple’s nascent supply chain in the country. A spokesperson for subsidiary Tata Electronics Pvt yesterday said that the company would restart work in “many areas of the facility today.” “We’ve been working diligently since Saturday to support our team and to identify the cause of the fire,”
RSS