Oil price eases as US producers restart operations

Tokyo — Oil prices drifted lower on Friday, pausing after three days of gains, as producers prepared to resume operations in the Gulf of Mexico and data showed Saudi Arabian exports rose from record lows.

Brent crude was down 6c at $43.24 a barrel by 1.12am GMT, while US oil futures dropped 6c to $40.91 a barrel. Both contracts have risen sharply this week as Hurricane Sally cut US production and are on track for a weekly gain of about 9%, the first in three weeks.

US offshore drillers and exporters began a clear-up on Thursday after Hurricane Sally weakened to a depression and started rebooting idle Gulf of Mexico rigs after closing down for five days.

Crews were flown back to at least 30 offshore oil and gas platforms. Equinor and Chevron began returning staff to platforms in the Gulf of Mexico, after Murphy Oil’s restart this week.

“Now the storm has passed, we should start to see this production coming back online,” ING Research said in a note.

In Saudi Arabia exports rose in July to 5.73-million barrels per day (bpd) from a record low the previous month, official data showed on Thursday.

Supporting prices, the Organization of the Petroleum Exporting Countries (Opec) and its allies said on Thursday the group will take action on members that are not complying with deep output cuts to support the market after a coronavirus-led slump in fuel demand.

Opec and other producers such as Russia, making up the so-called Opec+ group, are cutting 7.7-million barrels a day of output to support prices.

Reuters