FXTM research analyst Lukman Otunuga said: “Gold ventured higher last week with prices clipping two week highs above $1,354 as the lingering impact of Friday’s soft second quarter US GDP figure of 1.2% encouraged investors to install a round of buying”.
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Saudi Arabia has slashed the September price for its Arab Light crude oil for Asian customers by $1.30 a barrel, the largest cut for the flagship grade in almost a year, helping to shore up sales ahead of fall in demand in October.
“The recovery in Nigerian volumes remains fraught with uncertainty, but we lift 3Q 2016 crude production estimates by +0.1 million barrels per day to 1.5 million barrels per day, still some way below the country’s potential output”, according to the report. Customers in Asia account for the largest share of Iran’s new sales, according to shipping data.
Saudi crude OSPs set the trend for Iranian, Kuwaiti and Iraqi prices, affecting more than 12 million barrels per day (mbpd) of crude bound for Asia. The nation dropped to fourth-biggest Opec producer after global sanctions that restricted its supplies in 2012. Reuters revised OPEC’s crude oil production in June 2016 to 33.31 MMbpd.
Production last May in the West African country reached a 27-year low, though the government is hopeful that negotiations with militants could ease the attacks against oil infrastructure. Pricing for Light and Extra Light grades for United States clients was cut, by 20 cents and 40 cents, respectively, while the Medium and Heavy grades were unchanged.
Just last month, Saudi Aramco CEO Amin Nasser told media sources the company was not anxious about rival producers like Iraq, Iran and Russian Federation gaining ground on Asia, its main export market.
Brent crude has climbed 14 percent since the start of the year on supply disruptions from Nigeria to Canada. Saudi Arabia led the November 2014 decision by OPEC to maintain production levels to drive out higher-cost producers.
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The Arab Light OSP to the United States was cut by $0.20 a barrel to plus $0.25 a barrel to the Argus Sour Crude Index (ASCI), it said in a statement. Aramco raised the pricing of all grades except Extra Light to northwest Europe and the Mediterranean.
