Oil Futures Prices Rise on Ongoing North Sea outage, Nigeria Strike
Oil futures prices rose on Monday amid running out of options to an ongoing North Sea pipeline and because a strike by Nigerian oil workers threatened its crude exports and increasing the risk of firms having to sell cheaply until at least late 2019.
US West Texas Intermediate (WTI) crude futures were at $57.66 a barrel, up 36 cents, or 0.6 per cent, from their last settlement.
Brent crude futures prices, were at $63.72 a barrel, up 49 cents, or 0.8 percent, from their last close.
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High prices came against the backdrop of Nigerian oil workers strike and the disruption of pipeline continuous North Sea pipeline, which provides crude oil, which supports Brent index.
Ineos announced in the North Sea for a force majeure on all oil and gas shipments through the pipeline system Forties last week after finding cracks.
Traders said the price hikes were little because of pipeline cuts in the North Sea, providing crude oil that supports the Brent index, as well as indications that US oil production growth could slow.
In the United States, energy companies cut drilling equipment for new production for the first time in six weeks to 747 in the week ending Dec. 15, according to Baker Hughes of the Energy Services Company on Friday.
Despite this decline in drilling, activity is still much higher than this time last year, when the number of rigs is less than 500, and actual US production has risen by 16 per cent since mid-2016 to 9.8 million barrels per day. That means US production is rapidly approaching the largest producers of Saudi Arabia and Russia, which are pumping 10 million barrels per day and 11 million bpd, respectively.
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