BENGALURU- Crude prices settled higher on Friday fuelled by renewed supply concerns after OPEC+ producers rebuffed a US call to accelerate output increases even as demand nears pre-pandemic levels.
Brent crude rose $2.20 to settle at $82.74 per barrel, while US West Texas Intermediate crude (WTI) gained $2.46 to $81.27.
The Organization of the Petroleum Exporting Countries and allies including Russia, collectively known as OPEC+, agreed on Thursday to stick to their plan to raise oil output by 400,000 barrels per day from December. US President Joe Biden had called for extra output to cool rising prices.
OPEC’s decision to stay the course and the Biden administration’s lack of a substantial response has the oil rally continuing, said Bob Yawger, director of energy futures at Mizuho.
Only a coordinated effort, with China and others involved, would address the lack of barrels in the market, Yawger added.
Meanwhile, Asia liquefied natural gas (LNG) prices fell for a third straight week, as improved gas supply in Europe reduced the competition for LNG in Asia, though losses were limited by fresh demand from Pakistan and Turkey.
The average LNG price for December delivery into Northeast Asia fell to $29.50 per metric million British thermal units (mmBtu), down $1.50 or about 5 percent from the previous week, industry sources said.
European wholesale gas prices fell this week after flows from Russia through the Yamal pipeline resumed after a five-day pause.
LNG cargoes were also sold from Oman and Australia in the spot market, the sources said.
Chevron has completed maintenance at its Wheatstone LNG plant in Western Australia, with cargo exports expected to go up in the fourth quarter.
Still, ongoing issues at Freeport LNG’s plant in Texas, where feedgas to the plant fell to its lowest since September, are supporting prices in Asia, traders said.
Spot demand continues to be firm with some Chinese buyers scouting the market for cargoes for delivery in winter, one of them said.
Pakistan LNG is seeking two cargoes for delivery in November through an emergency tender after its term suppliers cancelled delivery of cargoes, sources have said.
Turkish state energy company Botas is seeking nine LNG cargoes for delivery in December, January and February, an industry source said, adding that the tender closed on Nov. 4.
The Electricity Generating Authority of Thailand (EGAT) earlier this week sought a cargo for delivery in December while Japan’s Hokkaido Gas was seeking a cargo for delivery in winter, industry sources said.
Temperatures are expected to fall below normal in Seoul, Beijing and Shanghai over the next two weeks, weather data from Refinitiv Eikon showed, which could also boost demand for the super-chilled fuel further.
