RIYADH: Oil prices fell on Thursday, after rising sharply in the first half of the week, as traders weighed a larger-than-expected build in US oil stocks against tightening global supply.
Brent futures were down 45 cents, or 0.4 percent, at $108.33 a barrel, while US West Texas Intermediate futures were off 69 cents, or 0.7 percent, at $103.56 a barrel at 0354 GMT.
Traders to cut Russian oil purchases
Major global trading houses are planning to reduce crude and fuel purchases from Russia’s state-controlled oil companies as early as May 15, sources told Reuters, to avoid falling foul of European Union sanctions on Russia.
The EU has not imposed a ban on imports of Russian oil in response to Russia’s invasion of Ukraine, because some countries such as Germany are heavily dependent on Russian oil and do not have the infrastructure in place to swap to alternatives.
Trading companies are, however, winding down purchases from Russian energy group Rosneft as they seek to comply with language in existing EU sanctions that were intended to limit Russia’s access to the international financial system, the sources said.
The wording of EU sanctions exempts oil purchases from Rosneft or Gazpromneft, which are listed in the legislation, deemed as “strictly necessary” to ensure Europe’s energy security.
Shell, TotalEnergies, 3R win contracts in Brazilian auction
Brazil on Wednesday granted 59 exploratory blocks of oil and natural gas to 13 companies, including Shell, TotalEnergies and 3R Petroleum.
The auction totaled 422.4 million reais ($90.10 million) in signature bonus, registering a premium of 854.84 percent, according to data from the country’s oil regulator ANP.
The areas that were sold are located in six Brazilian states and will result in investments of 406.3 million reais in the exploratory phase of the contract.
Shell Brasil was granted six blocks in the Santos Basin in a consortium with the Colombian Ecopetrol, while TotalEnergies won two areas in the same basin. The Brazilian company 3R Petroleum got six areas in the Potiguar Basin.
In a statement, Shell said Wednesday’s auction represented “another milestone” in its focus on Brazil, a country that accounts for about 13 percent of its global oil and gas production. With the new acquisitions, the company now holds more than 30 oil and gas contracts in the country.
(With inputs from Reuters)
