The US light, sweet crude oil price for November dropped slightly Oct. 4 as skepticism built among analysts regarding the Organization of Petroleum Organization’s proposal to cut cartel production to 32.5-33 million b/d.
Iran signed its first agreement under new improved terms for oil companies in efforts to increase the nation’s production. Shana, Iran’s oil ministry news agency, said the government signed a $2.2-billion contract with Tadbir Energy.
Iran, Nigeria, and Libya are expected to be exempted from reducing production as OPEC contemplates collectively cutting production by 200,000-700,000 b/d. OPEC has a meeting scheduled in Vienna in November when details of the proposal are expected to be discussed.
Saudi Arabia had indicated it is willing to consider reducing production for itself and for OPEC in general.
“It’s a different world when you have Saudi Arabia being proactive in supply management, to the world we had when Saudi Arabia said it’s up to the market,” said Paul Horsnell, head of commodities research at Standard Chartered PLC.
Oil prices rose in early trading on the New York market on Oct. 5 pending the weekly release of the US government’s estimated oil and product inventory.
The natural gas contract for November gained 4¢ to a rounded $2.96/MMbtu. On the spot market, the Henry Hub gas price rose 2¢ to $2.83/MMbtu.
Heating oil for November edged up to remain at a rounded $1.55/gal. The price for reformulated gasoline stock for oxygenates blending for November rose nearly 3¢ to a rounded $1.50/gal.
The December Brent crude contract on London’s ICE decreased 2¢ to settle at $50.87/bbl and the January contract fell 3¢ to settle at $51.43/bbl. The October gas oil contract settled at $456.50/tonne, up $8.25.
The average price for OPEC’s basket of benchmark crudes on Oct. 4 was $46.70/bbl, up 6¢.
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