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WTI crude oil futures fell 81 cents, or 2%, to $39.86 a barrel on Tuesday while Brent crude futures fell by 70 cents, or 1.6%, to $41.95 a barrel.
Brent and Gasoil had a strong day on Tuesday on supply beckons with falling Norwegian output and a Trump recovery.
HSFO prices were up around $4 since Wednesday open, with VLSFO prices up around $6. Fuel spreads are a lot more balanced compared to Tuesday’s opening, but again volumes are depressed due to the Chinese Holiday which ends today.
Chrysaor has agreed a reverse takeover of Premier Oil that will create the largest independent oil and gas group in the industry. Creditors in the struggling Premier Oil will take the second-largest stake, after Chrysaor who will own 77%, and the Premier shareholders will own less than 6%. Harbour Energy has already turned Chrysaor into the largest oil and gas producer in the North Sea after recent acquisitions of Shell and ConocoPhillips assets. (FT)
Nigeria’s State owned NNPC has extended its 2019-2020 crude-for-swaps agreement by 6 months which includes deals with Vitol, BP, Total and Gunvor whereby the companies receive crude in return for refined products. Nigeria relies on imports to meet its product demand, including 350,000 bpd of gasoline and 90,000 bpd of diesel consumed per day according to government figures. The MD of the NNPC has stated that they have saved $1 billion since the start of the programme, but it has been criticised since the government removed subsidies and relies on a market based pricing system, causing fluctuating prices. (Argus Media)
In main news, the Norwegian oil strikes are set to expand from the 10th October unless negotiations surrounding wages can progress over workers’ pay. The increasing effect of the strike would affect an additional four oil fields on the Norwegian shelf but it is too early to say the effect on output. The conflict offered stability for oil prices after two straight days of builds overnight. (Reuters)
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