Published: Tue, October 10, 2017
Money | By Armando Alvarado

Pradhan raises issue of Asian premium charged on oil with OPEC

Pradhan raises issue of Asian premium charged on oil with OPEC

Technological improvements and greater efficiency has helped USA shale producers pump out crude oil at lower margins - some say it is now profitable at less than $50 per barrel.

OPEC's Mohammad Barkindo also said growth in USA shale oil output had slowed compared to the first half of 2017 and growth in global demand may show further upward revisions, giving the supply cut effort tailwind.

Meanwhile, oil production platforms in the Gulf of Mexico on Monday after Hurricane Nate forced the shutdown of more than 90% of crude output in the area.

"Quiet market overall this morning though (refined) products are weaker as it looks like Nate was a non-event for refining", said Scott Shelton, broker at ICAP in Durham, North Carolina.

Separately, Total SA (TOTF.PA) completed the restart of units shut by Hurricane Harvey at its 225,500 barrel per day (bpd) Port Arthur, Texas, refinery not involved in an overhaul planned prior to the storm that hit late in August, the company said.

OPEC plans to meet on November 30 to assess the market and its production policy.

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OPEC and other oil producers may need to take "some extraordinary measures" next year to rebalance the oil market, the OPEC secretary-general said on Sunday.

Participants had a "very good, very frank conversation about the new formula for fixing crude prices in the oil market, which I have launched into debate", said Maduro.

"There is clear evidence that the market is rebalancing", Barkindo said in a recorded speech provided for the Reuters Global Commodities Summit taking place this week.

The price for Brent crude oil was down 0.56 percent at 9:00 a.m. EDT to $55.31 per barrel. Earlier in the session it touched a three-week low of $55.06. The price for West Texas Intermediate, the USA benchmark for the price of oil, was inching slightly higher, gaining 0.34 percent from Friday to $49.46 per barrel.

A day after crude prices fell 3% following a Reuters survey indicating that OPEC ramped up output in September, OPEC Secretary-General Mohammad Barkindo attempted to ease concerns over falling compliance with the deal to curb output. WTI's losses last week came to 4.6 percent.

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