Economy

Oil prices higher on Iraq tensions, slower supply

Oil prices higher on Iraq tensions, slower supply”

Much will depend on demand to guide prices, with the USA market tightening, flows from Iraq reduced due to fighting between government forces and Kurdish militant groups.

Oil prices swung between gains and losses on Monday, as traders digested upbeat signals from OPEC, supply disruptions in Iraq and a drop in US drilling activity.

The number of US rigs drilling for new oil fell by seven to 736 in the week to October 20, the lowest level since June, energy services firm Baker Hughes said on Friday.

And, news that OPEC compliance with the oil output cap continues is also helping to keep the supply of oil at a pace that helps keep prices around the $60 per barrel mark the cartel is said to target.

The weekly rig count is an important barometer for the drilling industry and serves as a proxy for domestic oil production.

Meanwhile, US benchmark West Texas Intermediate crude prices surged 0.5 per cent to $52.10 a barrel and Brent crude climbed 0.24 per cent to $57.89 a barrel. For the week, WTI prices rose about 0.8%, the second-straight weekly gain.

New Delhi, Oct 23 Crude palm oil prices fell 0.48 per cent to Rs 540.50 per 10 kg in futures trade today as traders booked profits amid fall in demand at the spot market.

The global benchmark ended the week with an increase of approximately 1%, supported by growing indications that the market was starting to rebalance.

In that vein, the Organization of the Petroleum Exporting Countries said that in September, its members and countries those outside OPEC achieved 120% compliance with the current output agreement.

The oil price according to a report by Business Day Online rose to $40 per barrel in March.

Still, analysts point to data showing that USA shale oil producers are poised to bring more crude online, which will weigh on oil prices.

Ahead of the coming week, Investing.com has compiled a list of these and other significant events likely to affect the markets.

On Tuesday, Iraqi government forces seized control of all oil fields that Iraqi state-held North Oil Company operates in the Kirkuk region from Kurdish forces.



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