Crude Oil Price Hits Record High as Iran Sanctions Tighten Supply Outlook

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 .As Forte Oil signs deals with Chevron

By Ejiofor Alike

With agency reports

Oil prices steadied near three and a half-year high yesterday at $77.47 a barrel as the prospect of new United States sanctions on Iran tightened the outlook for Middle East supply at a time when global crude production is only just keeping pace with rising demand.

This is coming as Forte Oil Plc at the weekend announced the signing of an agreement with Chevron Lubricants, Europe, Middle East and Africa, which will make Texaco-branded lubricants and engine oil available at Forte Oil Filling Stations in Nigeria

The United States plans to reintroduce sanctions against Iran, which pumps about four per cent of the world’s oil, after abandoning a deal reached in late 2015 that limited Tehran’s nuclear ambitions in exchange for the removal of US and European sanctions.

The global oil market is finely balanced, with top exporter Saudi Arabia and No.1 producer Russia having led efforts to curb oil supply to prop up prices.

Benchmark Brent crude was unchanged at $77.47 a barrel yesterday after hitting $78 on Thursday, its highest since November 2014.

US light crude was up at $71.56, having touched a three and a half year high of $71.89 on Thursday.

Many analysts expect oil prices to rise as Iran’s exports fall.

Reuters reported that analysts predicted that around October Iranian exports will be down by 500,000 barrels per day (bpd) and eventually fall by one million bpd.

There are signs, however, that other members of the Organization of the Petroleum Exporting Countries (OPEC) will raise output to counter the Iran disruption.

Outside OPEC, soaring US crude oil production could help to fill Iran’s supply gap. US oil output reached another record high last week, hitting 10.7 million bpd.

That is up 27 per cent since mid-2016 and means that US output is creeping ever closer to that of top producer Russia, which pumps about 11 million bpd.

In another development, the collaboration between Chevron Lubricants, owner of the Texaco brand and Forte Oil, a leading player in retail distribution of petroleum products in Nigeria, will open new opportunities for Nigerian motorists to purchase high quality engine oil.

From its strategic manufacturing hubs, the well-known Texaco-branded lubricants and engine oil will be supplied to the network of Forte Oil’s filling stations across the country.

Commenting on the partnership, the General Manager in charge of Chevron Lubricants, Stewart Wright said “we are delighted that this agreement means that motorists across Nigeria will have added choice when buying quality engine oil.”

“It is excellent news that our Texaco-branded lubricants are now so widely available and are here to stay in Nigeria,” Wright added.

Forte Oil’s Head of Marketing, Kenneth Otaru said: “Our collaboration with Chevron Lubricants will allow Nigerian motorists to enjoy a wider selection of engine oil and lubricants assured of the quality guaranteed by both the Forte Oil and Texaco brands.

“This is an exciting time for the downstream sector market and for the consumer. Forte Oil is pleased to join in this initiative to ensure that the best available products are located at every Forte Oil filling station,” Otaru added.