SINGAPORE: Oil prices were stable early on Tuesday, supported by a tightening market due to ongoing OPEC-led efforts to cut supplies, although the prospect of rising US shale output dragged.
Brent crude futures, the international benchmark for oil prices, were at $60.78 per barrel at 0343 GMT. That was 12 cents below their last settlement, but still not far off the highest level since July 2015 reached earlier this week and up some 37 percent since their 2017-lows last June.
US West Texas Intermediate (WTI) crude futures were at $54.05 a barrel, 10 cents below their last close. But that was still near their highest level since February and up around 28 percent since 2017-lows marked in June.
Despite generally upbeat market sentiment, some analysts were cautious after several days dominated by strong price rises.
“US shale output could keep a lid on prices over the medium to long-term,” said Shane Chanel, equities and derivatives adviser at ASR Wealth Advisers.
WTI’s $6.7 per barrel discount to Brent
There are also technical chart indicators that warrant caution, analysts said.
“The relative strength indexes (RSI) on both contracts are at overbought levels. These could leave oil vulnerable to short-term corrections lower,” said Jeffrey Halley, senior market analyst at future brokerage OANDA.
An RSI is a trading momentum indicator in which a value of over 70 points is seen to be overbought. Brent’s current RSI is at 70.12 points.
The bullish market has been fueled by an effort led by the Organization of the Petroleum Exporting Countries (OPEC) and Russia to hold back about 1.8 million barrels per day (bpd) in oil production to tighten markets and prop up prices.
The pact runs to March 2018, but Saudi Arabia and Russia have voiced support to extend the agreement.
OPEC is scheduled to meet officially at its headquarters in Vienna, Austria, on Nov. 30.
“The fear of oversupply could easily turn to a fear of undersupply if inventories keep declining like they have been and demand continues to grow,” said William O’Loughlin, investment analyst at Rivkin Securities.
Oil prices stable as OPEC-led supply cuts tighten market, but some caution remains
Oil prices stable as OPEC-led supply cuts tighten market, but some caution remains
Saudi Arabia opens 3rd round of Exploration Empowerment Program
RIYADH: Saudi Arabia’s Ministry of Industry and Mineral Resources, in collaboration with the Ministry of Investment, has opened applications for the third round of the Exploration Empowerment Program, part of ongoing efforts to accelerate mineral exploration in the Kingdom, reduce early-stage investment risks, and attract high-quality investment from local and international mining companies.
The third round of the Exploration Empowerment Program offers a comprehensive support package targeting exploration companies and mineral prospecting license holders.
The initiative aims to lower investment risks for projects and support a faster transition from prospecting to development.
"The program provides coverage of up to 70 percent of the total salaries of Saudi technical staff, such as geologists, during the first two years, increasing to 100 percent thereafter, in line with program requirements.
This support aims to develop talent, build national capabilities in mineral exploration, promote job localization, and facilitate the transfer of geological knowledge.
The application for the third round opened on Jan. 14, allowing participants to benefit from the Kingdom’s attractive investment environment, its stable legal framework, and streamlined regulatory structures, as well as integrated infrastructure that supports the transition from mineral resources to operational mines.
The ministry has set the timeline for the third round, with the application period running from Jan. 14 to March 31.
This will be followed by the evaluation, approval, and signing of agreements from April 1 to May 31, with the eligible projects set to be announced between June 1 and July 31 of the same year.
The program stages include submitting exploration data during the reimbursement and payment phase from Sept. 1 to Nov. 30, followed by technical and financial verification of work programs and approval of the disbursement of support funds in January 2027.
The exploration data will then be published on the National Geological Database in April 2027.
The ministry emphasized that the EEP focuses on supporting the exploration of strategically important minerals with national priority. It also contributes to enhancing geological knowledge by providing up-to-date data that meets international standards, helping investors make informed decisions and supporting the growth of national companies and local supply chains.
The ministry urged companies to apply early to benefit from the program’s third round, which coincided with the fifth edition of the International Mining Conference, which was held from Jan. 13 to 15.
