US drillers added 8-rigs to the total number of oil and gas rigs this week, according to Baker Hughes, adding 5 oil rigs and 3 gas rigs.
Meanwhile, neighboring Canada lost 5 oil rigs and 3 gas rigs for the week, after shedding hundreds of rigs in the in the last couple of months.
While oil prices are up on the month, both the Brent and WTI benchmark were trading down on the day in morning trading as the dollar rose but began paring some of those losses in the early afternoon.
Still, support for the higher oil prices remain as worry over Iranian sanctions persists—a worry that will likely continue to bolster oil prices until a decision is made on May 12—along with falling production in Venezuela and Angola.
The latest Monthly Oil Market Report by OPEC reveals that in the first quarter, Angola produced 1.574 million bpd of crude, down from 1.633 million bpd in the final quarter of 2017. In March, average daily production was the lowest for the quarter, at 1.524 million bpd, down by 81,700 bpd from February. Some analysts believe the decline will continue and may even accelerate. Venezuela’s oil production has averaged 1.544 million bpd for Q1, and 1.488 bpd for March—the latest information available from OPEC.
West Texas Intermediate (WTI) was trading up $0.02 (0.03%) at $68.21 at 1:09pm EST. The Brent benchmark was trading up $0.10 (0.14%) at $73.98. Neither benchmark is much changed from last week.
US oil production rose again in the week ending April 20, reaching 10.586 million bpd—the nineth build in as many weeks—less than a half million bpd off the 11.0 million bpd forecast that many predict for 2018.
At 1:35p.m. EST, WTI and Brent were both still trending upwards.
By Julianne Geiger for Oilprice.com
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Whether President Trump stays in the Iran deal or walks away from it is irrelevant to the global oil market or prices. The oil market has already factored in the probability of US withdrawal from the deal. A re-introduction of US sanctions on Iran will neither impact on the global oil market nor on oil prices. Iran’s oil exports will not lose a single barrel of oil as a result of the forthcoming sanctions. Moreover, Iran will be pricing its oil exports and paid for its exports by the petro-yuan thus bypassing the petrodollar and also nullifying US sanctions.
Furthermore, when the global oil market fundamentals are as bullish as they are currently, they can easily trump any bearish sentiments such as rising US oil production or increases in US crude oil and gasoline inventories or rising rig count.
Dr Mamdouh G Salameh
International Oil Economist
Visiting Professor of Energy Economics at ESCP Europe Business School, London
So now is the time for both U.S. shale oil and gas industry, and the renewables energy to go for broke. Its a gold rush. I predicted the U.S. would produce 11 million BPD by the end of this year, but now I'd bet on 11.5, or closer to $12. Renewables should triple down now while OPEC/Russia make them competitive. Triple down now and as production and market share rise focus like a laser on cutting cost so when oil does crash Renewables will still be the future. A future of low cost, clean, efficient energy. There will never be a better time to get oil out of the ground and make this kind of growing profit on it. So get busy!