Published By : 03 Nov 2015 | Published By : QYRESEARCH
Oil prices went up on Tuesday owing to concerns regarding production in Brazil and Libya, even though the ongoing global crude glut resulted in restricted price gains.
Oil production in Libya is estimated to fall by around 70,000 barrels per day to reach under 400,000 barrels just a day after an armed militia blocked the Eastern export terminal of Zueitina, Libya’s National Oil Co.’s spokesperson said on Tuesday.
Libya has the ability to pump around 1.5 million barrels per day. However, production of oil has been adversely affected during the armed conflict among competitive governments and attacks by radical Islamic State. Zueitina exports were stopped for five months this year by protests before they resumed in October.
Moreover, the largest oil sector union in Brazil commenced a strike on Sunday. Among other areas, the union represents employees who work on the oil platforms.
In August, Brazil produced 2.55 million barrels of crude oil and condensate per day, which, according to the International Energy Agency, is a record.
Sweet and light crude targeted for delivery next month recently went up 2.70 per cent or US$ 1.26 to reach US$ 47.40 per barrel on the New York Mercantile Exchange. The global benchmark Brent jumped 2.50 per cent or US$ 1.21 to settle at US$ 50 per barrel on ICE Futures Europe.
Oil prices have been tightly locked below the US$ 50 per barrel mark over the past few weeks with the market being continuously under the pressure of concerns regarding the global oversupply of crude.
Last year, the Organization of Petroleum Exporting Countries decided not to slash output targets in order to fight for a share of the market. However, the organization is now scheduled to get together for its meet in Vienna on December 4.