THE oil price rose above $60 per barrel again yesterday after trade tensions between the US and China eased at the weekend and Russia indicated it would work with Saudi Arabia to support the market.
Brent crude rose $3.14 per barrel, to peak at $62.60/bbl yesterday afternoon, following news on Sunday that Donald Trump and Chinese President Xi Jinping had agreed after the G20 summit to have a 90-day truce in their trade battle.
Bjarne Schieldrop, chief commodities analyst at Sweden’s SEB bank, noted Russia and Saudi Arabia had also agreed over the weekend to continue to cooperate with efforts to manage the supply of crude to the market which were initiated in late 2016 by OPEC and 10 other oil producers.
He added: “No decision of any specific cuts has yet been made but the message was clear: ‘we’ll monitor the market situation and react to it quickly.”
OPEC members are due to meet on Thursday and are expected to agree to limit production to help reverse the 30 per cent fall in the crude price from the four year high of $85 per barrel reached in October. The fall reflected surging production in the US and concerns about global growth.
Separately, Royal Dutch Shell said it would set shorter term targets to reduce its carbon emissions which will be linked to its executive pay policy.
The oil and gas giant said it would set targets covering three to five year periods in an annual exercise that would start in 2020. The targets will include emissions attributable to the use of Shell’s products by customers.
The move follows talks with investors that had complained the company’s existing commitment to cut carbon emissions by 50% by 2050 was inadequate.
Shell chief executive Ben van Beurden. “We are taking important steps towards turning our Net Carbon Footprint ambition into reality by setting shorter-term targets.”
Trade body Oil & Gas UK said the UK needed to maximise the recovery of its reserves in coming decades to provide security of supply while moving towards achieving climate change ambitions.
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