23 Apr 2017 – 20:17
The illicit refineries are just one component of oil theft in Nigeria, a mammoth industry estimated to be worth as much as $8 billion a year, according to a 2013 report by Chatham House, a London think-tank.
LONDON: Oil prices dipped on Monday, reversing earlier gains as concerns about a pick up in U.S. drilling activity trumped expectations that OPEC will extend output cuts till the end of 2017.
“It’s a still game of very narrow trading ranges between these mixed drivers,” said ABN AMRO’s senior energy economist Hans van Cleef. “If OPEC doesn’t extend those cut agreements, oil prices will fall under much more pressure.”
Brent crude futures fell 41 cents by 1447 GMT to $51.71 per barrel after hitting a session high of $52.57 a barrel.
US West Texas Intermediate (WTI) crude oil futures lost 46 cents to reach $49.16 a barrel, after reaching a high of $50.22 a barrel earlier in the day.
The Organization of the Petroleum Exporting Countries and other producers have so far pledged to cut output by almost 1.8 million barrels per day (bpd) in the first half of the year.
Oil prices rose earlier in Monday’s session after last week’s recommendation by a panel of OPEC and other producers to extend output cuts into the second half of 2017. Kuwait and Saudi Arabia also signalled they supported prolonging cuts.
But rising U.S. drilling and production has been putting a dampener on any oil price rally. Investors cut bullish bets on rising ICE Brent crude futures and options by 9,811 contracts to 427,433 lots in the week to April 18.
In the week to April 21, U.S. drillers added oil rigs for a 14th week in a row, to 688 rigs, extending an 11-month recovery that is expected to boost U.S. shale production in May by the biggest monthly increase in more than two years.
Since a trough in May 27, 2016, U.S. producers had added 372 oil rigs, a rise of 118 percent, Goldman Sachs said in a note.
U.S. crude production is at 9.25 million bpd , up almost 10 percent since mid-2016, approaching the level of OPEC’s top exporter Saudi Arabia.
(Additional reporting by Henning Gloystein in Singapore; Editing by Edmund Blair)