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Oil Prices Drop For 2nd Straight Day As IEA Set To Release Oil From Its Reserve

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Crude oil prices dropped on Friday, extending their slide from the previous session, as the International Energy Agency (IEA) said its members have agreed to release oil from strategic reserve to stabilize global energy markets.

“Details of the new emergency stock release will be made public early next week,” the IEA said, a day after the United States pledged its biggest oil release ever.

West Texas Intermediate Crude oil futures for May ended down by $1.01 or about 1% at $99.27 a barrel. WTI crude futures shed nearly 13% in the week, posting the biggest weekly loss in two years.

Brent crude futures settled lower by $0.32 or about 0.3% at $104.39 a barrel today, recovering from a low of $102.37. Brent crude futures too dropped about 13% in the week.

On Thursday, U.S. President Joe Biden authorized the release of 1 million barrels of oil per day from the nation’s Strategic Petroleum Reserve, for the next six months.

The White House made the announcement about the historic release from SPR, aiming to combat the spike in oil prices sparked by Russia’s invasion of Ukraine.

“The scale of this release is unprecedented: the world has never had a release of oil reserves at this 1 million per day rate for this length of time,” the White House said. “This record release will provide a historic amount of supply to serve as bridge until the end of the year when domestic production ramps up.”

A report released by Baker Hughes this afternoon said U.S. energy firms added oil and natural gas rigs for a second week in a row. The rig count rose by three to 673 this week, the highest level since March 2020.

The total rig count increased by 243 or 57% over this time last year, the report said.

Oil rigs increased by two to 533 this week, while gas rigs rose one to 138.

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