Oil prices rise - The Times Group Malawi

Oil prices rise as the business world forces itself to “recover”

Post was last updated: May 12, 2020

Oil prices rose on Monday, recovering earlier losses on news that leading exporter Saudi Arabia will reduce its output by 1 million barrels per day (bpd) on top of reductions agreed under an Opec+ supply pact.

Brent crude was up 19 cents, or almost 1 percent, at $31.16 a barrel by 1216 GMT, while US West Texas Intermediate crude rose 38 cents, or 1.5 percent, to $25.12. Both contracts had fallen more than $1 earlier in the session.

Global oil demand has slumped by about 30 percent as the coronavirus pandemic has curtailed movement across the world, leading to growing inventories globally.

To reduce the oversupply the Organization of the Petroleum Exporting Countries (OPEC) and allied producers – a grouping known as Opec+ agreed to cut production from May 1 by about 10 million bpd in an effort to support prices.

On Monday a Saudi energy ministry official said that the ministry has directed national oil company Saudi Aramco to reduce its crude oil production for June by an extra 1 million bpd.

Oil prices had fallen earlier in the session on signs of a second wave of coronavirus infections after Wuhan, the epicentre of the outbreak in China, reported its first cluster of infections since the city’s lockdown was lifted a month ago.

New coronavirus infections are accelerating in Germany only days after it loosened social restrictions, raising concerns that the pandemic could again slip out of control. South Korea also warned of a second wave of the virus on Sunday.

Fears that the United States is running out of oil storage space sent WTI prices into negative territory last month, prompting some US producers to rein in output.

The number of operating oil and gas rigs in the world’s largest oil producer fell to 374 in the week to May 8, a record low according to data going back to 1940 from energy services company Baker Hughes Co.

Both benchmarks have notched gains over the past two weeks, supported by a modest rebound in demand as some travel restrictions are eased.—Reuters

Let us know what you think of this update and remember to add us on our facebook and follow us on our twitter. Make sure to come back daily for more Malawi business news updates.

Quick Links: Malawi Radio Station Frequencies | Where To Eat In Malawi | Download Business eBooks | Ten Signs You Are An Entrepreneur | What is a Managing Director?

Today’s top business story: Top Commercial Banks In Malawi

Source Link