OpeOluwani Akintayo
28 January 2019, Sweetcrude, Lagos — Oil prices fell by one percent on Monday after the United States increased its oil and gas rig count by 10 last week.
The increase sent a signal of an impending glut in the market, crashing international Brent crude oil futures to $60.74 a barrel at 0804 GMT, down 90 cents, or 1.46 percent at the previous close.
OPEC’s daily basket price stood at $60.90p/d, while the U.S. crude oil futures were at $52.84 per barrel, down 85 cents, or 1.58 percent from their last close.
U.S. crude oil production, which rose to a record 11.9 million barrels per day last year, displacing the likes of Saudi Arabia and Russia.
And for the first time this year, the U.S added extra nine oil rigs and one gas rig last week, bringing the total overall rig count to 1,059, up from 947 one year ago- Baker Hughes energy services firm said in its weekly report on Friday.
Again, increasing crude production in the U.S is beginning to weigh in negatively on the OPEC+ cuts to boost prices.
The Organization of the Petroleum Exporting Countries, OPEC, Russia, and few other non-OPEC producers in December, decided to cut production by additional 1.2mb/d starting from this month.
Oil prices fuel demand-growth expectations are also being weighed down amid trade dispute between Washington and Beijing- although consumption has been increasing steadily, and analysts say it will likely average above 100 million bpd for the first time ever in 2019, still driven largely by a boom in China.
