By registering a further decline during today’s trading, Friday, the price of a barrel of oil is heading to incur the largest monthly loss since March 2020, as a result of Corona undermining economic growth in most countries of the world.
According to the latest data from the US “Bloomberg” network, a barrel of benchmark Brent crude lost 0.21% during trading today, recording $ 37.73, and US light crude 0.44%, to reach $ 36.33, the biggest monthly decline since last March, and the second monthly decline. Due to the growing fears that the high number of Covid-19 cases in Europe and the United States may harm fuel consumption.
Reuters quoted Geoffrey Haley, chief market analyst for the Asia-Pacific region at Oanda in Singapore, as saying: “In light of a European slowdown threatening global consumption and the return of Libya’s production, the burden must now fall on OPEC + to reconsider an increase Its production is two million barrels per day in January, “it is unlikely that oil prices will maintain any rise in this atmosphere that lacks an OPEC + statement.”
The Organization of the Petroleum Exporting Countries (OPEC) and its allies led by Russia, a group known as “OPEC +”, are expected to raise production by 2 million barrels per day in January as part of their production deal. But Saudi Arabia and Russia, two major producers, support maintaining the group’s production cuts of about 7.7 million barrels per day currently next year, with the threat of renewed isolation measures in Europe to slow demand again.
Russia and Iraq
Today, Interfax and TASS agencies quoted official data that Russia generally kept its oil and gas condensate production unchanged in October compared to September. They added that the daily production of oil and gas condensate in the period from From the beginning of October to the 29th of the same month, it averaged 1.359 million tons, equivalent to 9.96 million barrels per day. In September, production increased to 9.93 million barrels per day.
And from Baghdad, Iraqi Oil Minister Ihssan Abdul-Jabbar said in a statement today that his country, a member of OPEC, would support any collective decision taken by OPEC + regarding the policy of future oil production.
Total cuts its investments
Today, Total cut its target for investment in 2020 after a sharp drop in its third-quarter net profit, but the French oil and gas producer kept its dividends. The company reduced its investment target to $ 13 billion from $ 14 billion, and said it would also curb operating costs even as it seeks growth in the renewable energy and electricity markets, according to Reuters.
Energy companies have been hit hard by the lockdown measures linked to COVID-19 and the collapse in fuel demand due to it. The price of a barrel of Brent crude has remained largely above $ 40 since last June, but Total said today that the market remains in a state of uncertainty.
Total reported net income of $ 202 million, down 93% from a year ago, but recovered from a loss it incurred in the second quarter when it wrote off the value of assets. Adjusted net income fell 72% to $ 848 million, which beat analysts’ average forecast of $ 572 million, according to Refinitiv data.
While competitors such as Shell, BP and Eni cut dividends earlier in the year, Total committed itself to dividends during the crisis, and said it would maintain a dividend of € 0.66 per share in the third quarter.
Total lowered its forecast for oil and gas production for the year to less than 2.9 million barrels of oil equivalent per day from a previous estimate of between 2.9 and 2.95 million barrels. Its production fell in the third quarter by 11% to 2.715 million barrels of oil equivalent per day. Cash flows decreased 41% to $ 4.3 billion.