Cyber Monday Deal: Up to 60% off InvestingProCLAIM SALE

UPDATE 2-Oil falls as dollar strengthens but traders eye Nigerian outages

Published 2016-05-13, 05:26 a/m
© Reuters. UPDATE 2-Oil falls as dollar strengthens but traders eye Nigerian outages
XOM
-
LCO
-
CL
-
DXY
-

* Dollar hits two-week high against basket of currencies
* Exxon declares force majeure on Qua Iboe exports - traders
* Nigeria oil production has fallen to 1.65 mln bpd - FinMin
* At least four big Canadian producers declare force majeure

(Updates throughout, changes dateline, previous SINGAPORE)
By Karolin Schaps
LONDON, May 13 (Reuters) - Oil prices ended a three-day bull
run on Friday, falling as a strong dollar made it more expensive
to hold oil positions though losses were cushioned by Nigerian
outages that have slashed output to the lowest in 22 years.
The dollar .DXY hit a two-week high against a basket of
currencies on Friday, lifted by expectations the U.S. Federal
Reserve will raise rates again before any other major central
bank. USD/ FRX/
The strong U.S. currency weighed on greenback-denominated
commodities such as oil futures, making fuel imports more
expensive for countries using other currencies and potentially
hitting demand.
Global benchmark Brent crude futures LCOc1 were down 32
cents at $47.76 a barrel at 0833 GMT.
U.S. West Texas Intermediate crude futures CLc1 traded at
$46.20 a barrel, down 50 cents day on day.
Brent futures briefly turned positive in early European
trading after traders said Exxon Mobil (NYSE:XOM) XOM.N had declared
force majeure on Nigerian Qua Iboe crude exports following
mechanical problems with a pipeline.
The production glitch came after a number of other outages
that have reduced Nigeria's crude output to a 22-year low.
Nigeria's finance minister told NTA television the country's
oil production had dropped to 1.65 million barrels per day (bpd)
from 2.2 million bpd seen before the outages.
"We expected more supply disruptions out of Nigeria this
week but the pace of new supply problems from that country beats
our expectations," Petromatrix oil analyst Olivier Jakob said.
He said Nigerian production was unlikely to be much above 1
million bpd, excluding condensates.
Production losses in Nigeria added to ongoing outages in
Canada where wildfires forced the closure of oil sands
facilities and declarations of force majeure from at least four
major oil firms.
"Wildfires may have temporarily shut in as much as 1.4
million bpd of production, but there appears to be no facility
damage. Operations are beginning to restart, but we believe
(assuming no pipeline damages) it will take weeks to ramp
production," U.S. investment bank Jefferies said.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.