ISLAMABAD: Oil prices edged lower on Thursday amid fears of global economic slowdown despite production and export cuts announced earlier this week by Saudi Arabia and Russia. As of 1345 hours GMT, Brent, the international benchmark for two-thirds of the world’s oil, shed $0.30 (-0.39 percent) to reach $76.35 a barrel. The West Texas Intermediate (WTI), the main oil benchmark for North America, went down by $0.21 (-0.29 percent) to $71.58 a barrel. However, the price of Russian Sokol increased by $0.72 (+1.08 percent) to $67.41. Arab Light prices witnessed an increase of $0.78 (+0.99 percent) to reach $79.26 a barrel. Following suit, the price for Opec Basket increased by $1.84 (+2.48 percent) to $76.18. The OPEC Reference Basket of Crudes (ORB) is made up of Saharan Blend, Girassol, Djeno, Zafiro, Rabi Light, Iran Heavy, Basra Light, Kuwait Export, Es Sider, Bonny Light, Arab Light, Murban and Merey. TLTP
The market is expecting interest rate hikes in the US and Europe to tame stubbornly high inflation while fears of a global recession have been heightened by recent surveys showing that factory and services activity in China and Europe has slowed.
Earlier this week, Russia announced it would further reduce its supply of oil. “As part of the efforts to ensure a balanced market, Russia will voluntarily reduce its oil supply in August by 500,000 barrels per day by cutting its exports to global markets by that quantity,” Russia’s Deputy Prime Minister and top OPEC negotiator Alexander Novak said earlier this week.
The latest oil production and export cuts announced earlier this week by the OPEC+ leaders – Saudi Arabia and Russia –should be sufficient to bring the oil market back to balance, Suhail Al Mazrouei, the energy minister of the United Arab Emirates (UAE), said on Wednesday. “This is enough to assess the market and look at the market balance,” Al Mazrouei told reporters.
