Friday 6 November 2015

Nigeria’s sweet crude price falls to $46.32 per barrel

Oil Rig
The price of Nigeria’s sweet crude, yesterday, fell to $46.32 per barrel against $47.17 a barrel it was offered in the market on Wednesday.

Also, the global benchmark, Brent crude oil fell from $50.54 per barrel to $48.58 a barrel as at yesterday.

Besides, multinational oil and gas companies recorded revenue drop in their respective third quarter operations due to the declining crude oil prices.

The oil price slide was attributed to the increase in United States crude supplies.

The latest crude oil price is still below the Federal Government budget benchmark of N53 per barrel.

The price of OPEC basket of 12 crudes was $43.94 a barrel on Tuesday, compared with $44.01 the previous day, according to Organisation of Petroleum Exporting Countries (OPEC) Secretariat calculations.

Meanwhile, the falling oil prices have hit oil companies’ bottom lines, with Royal Dutch Shell Plc for instance, recording loss of $7.4 billion for the third quarter with its huge expenditures incurred for reorganizing and canceling major projects adding to its travails.

Also, Chevron Corporation reported earnings of $2.0 billion for third quarter 2015, compared with $5.6 billion revenue in the 2014 third quarter.

The company, which had already laid off 87,000 people so far this year, announced that it would be retrenching about 7,000 workers more.

Chief Executive Officer of the company, John Watson stated: “Third quarter earnings were down substantially from a year ago. While downstream earnings remained strong, lower overall earnings reflected weaker market prices for both crude oil and natural gas, which depressed upstream profitability. We are focused on improving results by changing outcomes within our control. Operating and administrative expenses are seven per cent lower than last year, and we expect further reductions in the quarters ahead.”

Exxon Mobil Corp said that third-quarter profit fell by 47 per cent on low crude prices but results were better than expected, helped by higher profit in the oil company’s refining business.

The company announced estimated third quarter 2015 earnings of $4.2 billion, or $1.01 per diluted share, compared with $8.1 billion a year earlier. Significantly lower upstream realizations more than offset higher downstream and chemical earnings.

“We maintain a relentless focus on business fundamentals, including cost management, regardless of commodity prices,” said Rex W. Tillerson, chairman and chief executive officer. “Quarterly results reflect the continued strength of our Downstream and Chemical businesses and underscore the benefits of our integrated business model.”

The Chief Executive Officer of Total Oil and Gas, Patrick Pouyanné, while reacting to not too impressive performance by the company said: “In a context where the oil price has fallen by 50 per cent in one year, Total was able to demonstrate its resilience by limiting to 23 per cent the decrease in its third quarter adjusted net income of $2.8 billion.

Credit: TheGuardian

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