LONDON: Oil hit a 2019 high above $69 a barrel on Tuesday on the prospect that more sanctions against Iran and further Venezuelan disruptions could deepen an OPEC-led supply cut, and as the market became less worried that demand may slow.
The United States is considering more sanctions against Iran, whose oil exports have been halved by existing measures, an official said. A key crude terminal in Venezuela, also under US sanctions, has halted operations again.
Brent crude rose 10 cents to $69.11 a barrel by 0826 GMT, having touched $69.50, the highest since mid-November. US crude was up 11 cents at $61.70 after rising above $62 for the first time since early November.
“The supply cuts have been there for a while but Venezuela is not improving,” said Olivier Jakob, analyst at Petromatrix. “That is taking a lot of oil away from the market.”
Further supply losses from Iran and Venezuela could widen an OPEC-led production cut that took effect in January, designed to prevent a price-sapping rise in inventories.
Supply from the Organization of the Petroleum Exporting Countries hit a four-year low in March, a Reuters survey found, because top exporter Saudi Arabia cut more than it had agreed to and due to the involuntary declines.
This week’s reports on US supplies are expected to show crude inventories fell, a sign that the OPEC curbs are having the impact producers intended.
Six analysts polled by Reuters estimated, on average, that crude stocks fell by 1.2 million barrels in the week to March 29. The first of this week’s supply reports, from the American Petroleum Institute, is due at 2030 GMT.
Oil’s pattern on the price charts could lead to further gains. Brent is trading just below the 200-day moving average and a move above this mark would provide additional technical support, Jakob said.
Healthy data on the world’s biggest economies, the United States and China, also bolstered prices.
Figures showing a rebound in US factory activity in March and a return to growth in Chinese manufacturing eased concern that an economic slowdown could weaken oil demand.
“China’s PMI number was the most significant monthly increase since 2012, which should ease concerns around a potential threat to oil demand,” said Stephen Innes, head of trading and market strategy at SPI Asset Management.
Oil hits 2019 high on OPEC cuts, concerns over demand ease
Oil hits 2019 high on OPEC cuts, concerns over demand ease
- The US is considering more sanctions against Iran, whose oil exports have been halved by existing measures
- Oil’s pattern on the price charts could lead to further gains
Industry minister inaugurates advanced factories in Sudair
SUDAIR: Minister of Industry and Mineral Resources and Chairman of the Board of the Saudi Authority for Industrial Cities and Technology Zones, known as MODON, Bandar Alkhorayef, on Feb. 16, inaugurated several advanced factories to produce food, pharmaceuticals, medical equipment, and construction materials in Sudair City for Industry and Businesses.
The move is part of the ministry’s efforts to localize high-value industries and enhance the Kingdom’s health and food security.
The minister inaugurated the Sierra Life factory, the first facility in the Middle East specializing in producing medical foods for metabolic disorders.
This strategic investment aims to localize advanced therapeutic food production and integrate the industrial and health sectors to meet medical needs previously heavily reliant on imports.
Alkhorayef reviewed precise production lines for patients with metabolic disorders such as phenylketonuria, or PKU, and urea cycle disorders, as well as gluten-free and low-protein products for celiac patients.
The facility employs advanced manufacturing technologies and global quality standards, establishing a unique medical-industrial hub serving specialized medical cases in the region.
The minister also inaugurated the Sudair Warehouses project, representing an important step in developing logistics and industrial infrastructure.
The project reflects the industrial sector’s commitment to supporting industrial investors, stimulating high-value investments, and enabling national supply chains, thereby contributing to the achievement of Saudi Vision 2030 objectives.
Among the facilities inaugurated was Qomel Pharmaceutical Industries, supporting the localization of biopharmaceutical production in Saudi Arabia.
During his tour, the minister also reviewed the fully integrated industrial environment for producing solid pharmaceutical forms, such as tablets and capsules, advanced manufacturing operations, robust quality systems, high-level regulatory compliance procedures, and modern technologies that enhance production efficiency according to international standards. These measures help ensure product quality, reliability, and safety.
Alkhorayef also inaugurated Al-Hatab Foods Factory, the largest chilled food facility in the Middle East and a pioneering national project supporting the growth of the Kingdom’s food industry.
The minister reviewed advanced manufacturing methods that reduce bacterial growth and prolong shelf life without preservatives or heat treatment, maintaining nutritional value and high quality.
Al-Hatab operates 15 production lines for a wide range of fresh foods, including juices, salads, and sandwiches, with a capacity exceeding 6 million units per week, meeting growing domestic demand and reflecting the evolution of the Saudi food industry.
Alkhorayef also inaugurated the Industrial Orthopedic Co., which focuses on localizing the production of orthopedic medical devices. He reviewed production processes and technologies for manufacturing rods and screws for limb and spinal fracture treatment, artificial joints, and patient-specific products using 3D printing.
The project is currently undergoing operational testing, qualification, and workforce training, while quality, documentation, and traceability systems are being finalized ahead of full-scale production and regional and global expansion.
Additionally, the minister inaugurated a factory specializing in construction panels and industrial building solutions, providing sustainable insulation products that support the Kingdom’s construction sector.
The facility represents an investment of SR100 million ($27 million), incorporates 80 percent industrial automation across its production lines and operations, and has an annual capacity of 200,000 linear meters of insulating panels.
During his visit to Sudair City for Industry and Businesses, the minister also inaugurated the ready-made factories project, developed by Pan Kingdom Co.
This initiative is a key step in developing logistical and industrial infrastructure, supporting industrial investors, promoting strategic investments, and enabling national supply chains, contributing to the objectives of Saudi Vision 2030.
The project provides advanced operational spaces, fosters the growth of the manufacturing sector and creates quality jobs, as well as enhances local content and strengthens industrial sector efficiency.
The minister’s visit underscores the ministry’s commitment to creating a competitive investment environment in the industrial sector, developing infrastructure in industrial cities, and expanding the localization of industries related to food and health security, further positioning the Kingdom as a leading industrial hub regionally and globally.
