SINGAPORE: Crude prices dipped early on Monday in Asia as U.S. drilling activity picked up and as Russia’s biggest oil producer pressured President Vladimir Putin to end the supply cut deal with Middle East-dominated producer club OPEC.
U.S. West Texas Intermediate (WTI) crude futures were at $52.44 per barrel at 0036 GMT, down 28 cents, or 0.5 percent, from their last settlement.
International Brent crude oil futures were down 10 cents, or 0.2 percent, at $62 a barrel.Advertisement
In the United States, energy firms last week increased the number of oil rigs operating for the second time in three weeks, a weekly report by Baker Hughes.
Companies added 7 oil rigs in the week to Feb. 8, bringing the total count to 854, pointing to a further rise in U.S. crude production, which already stands at a record 11.9 million barrels per day (bpd). <C-OUT-T-EIA>
Elsewhere, the head of Russian oil giant Rosneft, Igor Sechin, has written to the Russian President Vladimir Putin saying Moscow’s deal with the Organization of the Petroleum Exporting Countries (OPEC) to withhold output is a strategic threat and plays into the hands of the United States.
The so-called OPEC+ deal has been in place since 2017, aimed at reining in a global supply overhang. It has been extended several times and, under the latest deal, participants are cutting output by 1.2 million bpd until the end of June.
OPEC and its allies will meet on April 17-18 in Vienna to review the pact.
Preventing crude prices from falling much further have been U.S. sanctions on Venezuela, targetting its state-owned oil firm PDVSA.
“The issues in Venezuela continue to support prices. Reports are emerging that PDVSA is scrambling to secure new markets for its crude, after the U.S. placed additional sanctions on the country,” ANZ bank said on Monday.
Source: The Edge Markets