By Ebru Sengul Cevrioglu – September 25, 2020
(Anadolu Agency) – Crude oil prices showed declines during the week ending Sept. 25 from concerns over rapid COVID-19 resurgence worldwide and expectations of increased supply from Iraq and Libya but prices stabilized above $40 per barrel on Friday afternoon.
International benchmark Brent crude was trading at $41.80 at 1229 GMT on Friday, posting a 2.8% decrease from Monday when it traded at $43.01 per barrel at 0730 GMT.
American benchmark West Texas Intermediate (WTI) traded at $40.05 at the same time on Friday relative to $40.98 a barrel on Monday.
Oil prices increased on Friday morning over the restart of stalled talks between US Republicans and Democrats on the stimulus package for the coronavirus pandemic.
However, mounting worries over rising COVID-19 infections, as well as market expectations of Libya’s increasing oil exports and Iraq’s oil production pressured prices during the week.
International media outlets reported that oil traders confirmed a sharp increase in Iraqi export cargoes for next month and the sale of a larger-than-normal number of Iraqi crude cargoes on the spot market for October.
Iraq recently denied reports that it will seek an exemption from the production cuts agreed on under the declaration of cooperation for countries participating in the Organization of the Petroleum Exporting Countries (OPEC) agreement.
Last month, Iraq promised to slash its oil production by an additional 400,000 barrels per day (bpd) in both August and September to offset its overproduction over the previous three months.
Meanwhile, the downward trend in oil prices was also supported by Libya’s announcement that it would restart oil exports. Libya’s National Oil Corp (NOC) lifted a force majeure on the country’s oil ports and facilities last Saturday, after eastern Libyan commander Khalifa Haftar lifted the eight-month oil export blockade last Friday.
In addition to rising supplies, uncertainty over the resurgence of the COVID-19 along with the possibility of renewed lockdowns is negatively affecting the global economic recovery while continuing to suppress international oil prices.