March 3, 2024
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OIL & GAS RENEWABLE ENERGY

Oil Prices Dip Ahead of Christmas, but Finish the Week Up in Angola

Oil prices experienced a slight decline on Friday in anticipation of the extended Christmas holiday weekend. Brent futures dropped by 0.4% to settle at $79.07 per barrel, and U.S. West Texas Intermediate (WTI) crude fell by 0.5% to settle at $73.56. Despite this, both benchmarks closed the week with approximately a 3% gain, following a less than 1% increase the previous week.

The possibility of increased output from Angola, which recently left the Organization of the Petroleum Exporting Countries (OPEC), contributed to the downward pressure on prices. However, concerns about Houthi attacks on ships in the Red Sea and positive U.S. economic news kept weekly gains intact, according to Reuters.

In the Middle East, major shipping companies, including Maersk and CMA CGM, announced they would impose extra charges due to re-routing ships away from the Red Sea following Houthi attacks. The disruptions in the Red Sea have not only directly impacted the oil supply but have also led to rising freight rates and insurance costs.

Additionally, Angola’s departure from OPEC raised questions about increased Chinese investment in the country’s oil and other sectors. Although any potential rise in Angola’s oil production would take time, factors like U.S. inflation data and Houthi attacks were seen as more influential in supporting oil prices than future output increases from Angola.

Meanwhile, Iraq reaffirmed its support for the OPEC+ agreement and commitment to voluntary oil cuts. The OPEC+ coalition includes OPEC members and allies like Russia.

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