Oil prices are rising, but ending the week in the red amid fears of lower demand due to the return of restrictive measures in a number of countries, including France and the UK, as well as signals of a possible increase in supply.
The day before, Bloomberg reported, citing oil traders, about a sharp increase in the supply of Iraqi oil for delivery in October. This could mean an increase in oil production in the country, which, on the contrary, must reduce production in excess of the established quotas in accordance with the compensation mechanism under OPEC +.
Also this week, the Libyan National Oil Corp. reported the resumption of oil production in the east of the country after the commander of the Libyan National Army (LNA) Khalifa Haftar announced the lifting of an eight-month blockade of oil fields and ports as a result of an agreement with the government in Tripoli.
“Bearish sentiment, driven by expected increases in supplies from Iraq and Libya, as well as renewed increases in COVID-19 incidence in Europe, outweigh the market impact of declining US oil inventories,” said Vandana Hari, founder of Vanda Insights in Singapore.
AxiCorp experts note that while there are several factors that put pressure on the oil market, the key is still the expected decline in demand.
The cost of November futures for Brent oil on the London stock exchange ICE Futures by 8:39 Moscow time on Friday is $ 42.13 per barrel, which is $ 0.19 (0.45%) higher than the price at the close of the previous session. As a result of trading on Thursday, these contracts increased by $ 0.17 (0.4%), to $ 41.94 per barrel.
The price of futures for WTI crude oil for November at electronic trading on the New York Mercantile Exchange (NYMEX) by this time is $ 40.51 per barrel, which is $ 0.20 (0.50%) higher than the level of the previous session. On Thursday, futures rose in price by $ 0.38 (0.1%) – to $ 40.31 per barrel.
Since the beginning of this week, Brent has fallen in price by 2.1%, WTI – by 1.7%