Oil prices drop on jump of Canadian oil drilling rigs

  • World
  • Saturday, 10 Jun 2023

NEW YORK, June 9 (Xinhua) -- Crude oil futures prices extended losses on Friday on a big rise in active oil drilling rig counts in Canada.

The West Texas Intermediate (WTI) for July delivery shed 1.12 U.S. dollars, or 1.57 percent, to settle at 70.17 dollars a barrel on the New York Mercantile Exchange. Brent crude for August delivery dropped by 1.17 dollars, or 1.54 percent, to settle at 74.79 dollars a barrel on the London ICE Futures Exchange.

Canada added 34 active oil drilling rigs this week to reach 85, according to data issued by oil service company Baker Hughes on Friday afternoon. The United States added only one active oil drilling rig to reach 556 this week.

Oil companies have been working to restart operation in Alberta, Canada, following shut-in of around 300,000-barrels-per-day production capacity in early May amid wildfires in the area.

WTI oil is moving lower as traders remain worried about the strength of the oil demand in summer, said Vladimir Zernov, analyst with market information supplier FX Empire.

The recent announcements from the Organization of the Petroleum Exporting Countries and its partners (OPEC+) did not provide material support to the market, according to Zernov.

OPEC and its partners announced on June 4 that they would deepen production cuts throughout 2024 by slashing another 1.393 million barrels of crude oil production each day.

Nine members of OPEC+, led by Russia and Saudi Arabia, also would extend the existing voluntary production cut throughput 2024. Moreover, Saudi Arabia announced another plan to cut oil supply by 1 million barrels per day in July on a voluntary basis.

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