The November delivery of Brent crude futures expired recently, and the contract settled at USD 71.77 a barrel, down 21 cents.

Meanwhile, the more actively traded Brent contract for December delivery gained 27 cents to USD 71.81.

The global benchmark experienced its largest monthly loss since November 2022 when it fell by 9% in September 2024. The global benchmark fell by 17% in the third quarter, marking its largest quarterly loss in a year following a third consecutive month of declines.

WTI futures decreased by one cent, ultimately settling at USD 68.17. The US benchmark experienced its largest monthly decline since October 2023 of 7%, and its largest quarterly decline since the third quarter of 2023 of 16%.

The prospect that Iran, a major producer and member of the Organisation of the Petroleum Exporting Countries (OPEC), may be directly involved in an intensifying Middle East conflict supported prices.

Israel has intensified its attacks over the last two weeks, executing strikes that have struck Houthi targets in Yemen and killed leaders of Hamas and Hezbollah in Lebanon.

According to Matador Economics economist Tim Snyder, the market is considering whether the conflict in the Middle East will spread to other parts of the region.

The world’s second-biggest economy and top oil importer, China, announced fiscal stimulus measures recently, but the impact on oil prices was muted. Traders wonder if these steps will be sufficient to improve China’s demand, which has started the year off weaker than anticipated.

In addition, worries about growing global crude supplies are impacting the month’s prices.

The de facto leader of OPEC, Saudi Arabia, was reported to be getting ready to abandon its unofficial price target of USD 100 per barrel for crude as it prepared to increase output, which caused oil prices to plummet.

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Tender Board Chairman Shaikh Nayef bin Khalid Al Khalifa told the media, “Despite the ongoing global economic challenges, the first nine months of 2020 have seen Bahrain award more than 1,000 contracts valued at well over $2 billion to businesses in all sectors across the board. This robust performance is indicative of Bahrain’s commitment and ability to remain open for business even in times of crisis. Of particular note is the consistently high value of contracts in the kingdom’s thriving construction and engineering sector, testament to the rich opportunity on offer owing to our extensive, multi-billion dollar pipeline of projects there.”

Last month, state news agency BNA reported that Bahrain’s Oil and Gas and US-based oil giant Chevron have signed an agreement to conduct a joint study assessing future demand for gas in the kingdom and identify potential sources of supply.

The company also recently signed a Memorandum of Understanding (MoU) with Air Products to boost the usage of hydrogen energy. Mazan Matar, Chairman of Bahrain LNG WLL signed the MoU with Imtiaz Mahtab, Air Products President of Middle East, Egypt and Turkey.

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Reportedly, Adnoc is also speeding up its original plan to produce 5 million barrels of oil per day by 2030.

Adnoc Group chief executive officer, Dr. Sultan Ahmed Al Jaber told the media, “In line with our production capacity growth strategy announced by the Supreme Petroleum Council, we are in a position to supply the market with over 4 million bpd in April. In addition, we will accelerate our planned 5 million bpd capacity target.”

“In response to market conditions, and to provide better forward visibility to our customers, ADNOC will shortly announce forward prices for the months of March and April 2020. This decision has been made to ensure that our customers have visibility of the price so they can plan accordingly.”

Currently, Adnoc supplies around 3 million barrels of oil per day to its suppliers.

Global crude oil prices have dropped by 30 percent, the lowest since the 1991 Gulf War. This drastic drop is due to the failed negotiations between Saudi Arabia-led OPEC and Russia. Saudi Arabia slashed oil prices by 10 percent last Saturday and as a result, oil stocks across various exchanges in Asia-Pacific, Tokyo, Australia, Hong Kong, and the US plunged in early Monday trading.

Recently, Saudi Arabia’s state-owned oil company Aramco has announced that it will increase crude production by 300,000 barrels per day over the company’s maximum sustained capacity of 12 million barrels.

The move to increase crude production is a part of the Saudi government’s plan to stay competitive in the global oil market amid a price war with Russia.

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Premier Oil, a UK-based independent oil company, has acquired the stakes in the Andaman I and south Andaman blocks.
Mubadala Petroleum, which is a wholly-owned subsidiary of Mubadala Investment Company, will retain the remaining 80 participating interest in the gas fields in Indonesia.

With regard to the stake sale, Dr. Bakheet Al Katheeri, chief executive at Mubadala Petroleum told the media, “The completion of this farmout is another important step for Mubadala Petroleum and for the exploration of the Andaman blocks offshore Aceh, and supports Mubadala Petroleum’s growth strategy in Indonesia.”

The government of Indonesia has also given its approval for the deal.

Premier Oil, on the other hand, owns a 70 percent participating interest in the Andaman II block. The remaining 30 percent is owned by Mubadala Petroleum.

Mubadala Petroleum has been operating in Indonesia since 2004.

Earlier this month, Mubadala Petroleum, along with Royal Dutch Shell and Chevron, was awarded exploration rights in the Red Sea by the Egyptian government.

While Chevron and Royal Dutch Shell were awarded a block each, Mubadala Petroleum will share a block with Shell.
In the month of November 2019, Mubadala Petroleum started exploration in the Manora oil field in the Gulf of Thailand, along with Tap Oil, an Australia-based independent oil company.

While Mubadala Petroleum holds a 70 percent participating interest in the oil field, Tap Oil holds the other 30 percent.

Similarly, the UAE-based oil company also signed a production sharing contract with Thailand’s PTTEP Energy Development Company. Both the companies will work together to develop the offshore Block G1/61 that contains the Erawan field.

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