Keystone Tragedy Hits Oil Price at Highest Level in Last Two Years

By : Abraham Sihombing And Aldo Bella Putra | Monday, November 27 2017 - 17:00 IWST

OPEC (Foto Ist)
OPEC (Foto Ist) - Singapore - The closure of the Keystone crude oil distribution network in the United States (US) with 590,000 barrels per day (bpd) has the potential to depress US crude stockpiles, prompting a rise in crude oil prices in global markets.

In addition, an extension of an agreement to cut oil production to OPEC and non-OPEC global markets also supports market conditions.

The closure of the operation of the crude oil distribution pipeline is due to an oil spill due to a possible pipeline leakage. The pipeline connects between the US and Canada.

According to a Reuters report in Singapore, the price of West Texas Intermediate (WTI) crude was at US $ 58.91 per barrel on Monday morning (27/11/2017).

The price is 4 cents lower than in the previous trading session. However, it is close to the highest crude oil price in the past two years which stood at US $ 59.05 per barrel.

Meanwhile, Brent crude traded at $ 63.84 a barrel, unchanged from the previous trading session.

William O'Loughlin, Rivkin Securities analyst, said, the price of WTI is now transacted near US $ 59 per barrel. That is a significant price increase, which is 38% since mid-June when oil is used as one of the best assets.

Meanwhile, oil supplies to global markets also tightened due to an agreement between OPEC and non-OPEC groups, including Russia, to cut crude output by 1.8 million barrels per day since January 2017.

The deal is due to expire in March 2018, but OPEC on November 30, 2017 will meet in Vienna, Austria, to discuss the deal.

"With the OPEC meeting this week, market participants are likely to expect an extension of the deal to cut production," O'Loughlin said.

Alexander Novak, Russia's energy minister, explained that Russia will again discuss details of the extension of the deal at its November 30, 2017 meeting, but Novax did not mention how long it should last after the March 2018 deadline.

Uncertainty about Russia's commitment to crude oil supply reductions to the market continues and increased US crude oil production can continue to re-press crude oil.

Since mid-2016, US crude oil production rose 15% to 9.66 million bpd with an expected continuing increase in drilling activity for new production.

Last week, American energy companies added the operation of the oil rig so that the number of monthly rigs increased for the first time since July to 747 active rigs as oil producers were attracted by rising crude oil prices for cooking. (Abraham Sihombing)

News Comment

Today's Industry

 AICPA and CIMA (the Association)

Jumat, 07 Oktober 2022 - 16:55 WIB

AICPA & CIMA executives urge Indonesian accounting and finance professionals to seize the opportunity presented by the environmental societal and governance agenda

The leaders of the world’s largest body of accountants and finance professionals, AICPA & CIMA, urged the accounting and finance community in Indonesia to take the lead in guiding businesses…

Asahi Kasei Europe GmbH

Kamis, 06 Oktober 2022 - 21:26 WIB

Mercury-free UVC disinfection – Asahi Kasei demonstrates how Crystal IS UVC LED technology can be applied to achieve higher disinfection efficiency in water treat- ment than conventional mercury lamp

Asahi Kasei, a diversified Japanese multinational company, and subsidiary Crystal IS have concluded in a bacterial perfor- mance test, an experimental Klaran™ WR water treatment reactor demonstrated…

PT Buyung Poetra Sembada Tbk (“HOKI”)

Kamis, 06 Oktober 2022 - 20:00 WIB

HOKI Targets to Open 80 WarungKoki Outlets by the End of this Year

PT Buyung Poetra Sembada Tbk (“HOKI”), an issuer of quality rice producers under the “Topi Koki” and “HOKI” brands, targets the growth of WarungKoki outlets by 80 outlets by the…

(Photo: © 2022 KRAIBURG TPE)

Kamis, 06 Oktober 2022 - 18:12 WIB

TPEs shine in lipstick packaging

KRAIBURG TPE, a global TPE manufacturer of thermoplastic elastomer products and custom-engineered materials solutions, offer the THERMOLAST® K FC/LF and FC/AD/PP series of compounds for lipstick…

Deputy Minister of Culture, Sports and Tourism, Mr. Doan Van Viet

Kamis, 06 Oktober 2022 - 17:30 WIB

Deputy Minister Outlines Viet Nam’s Tourism Priorities

Ahead of the Mekong Tourism Forum in Quang Nam, Central Viet Nam, 12-13 October, Mr Doan Van Viet, Viet Nam’s Deputy Minister of Culture, Sports and Tourism, outlines the vision and latest…