Oil Down $2 as Investors Digest Weak US Job Data

FILE - This Nov. 6, 2013 file photo shows a Whiting Petroleum Co. pump jack pulling crude oil from the Bakken region of the Northern Plains near Bainville, Mont. (AP Photo/Matthew Brown, File)
FILE - This Nov. 6, 2013 file photo shows a Whiting Petroleum Co. pump jack pulling crude oil from the Bakken region of the Northern Plains near Bainville, Mont. (AP Photo/Matthew Brown, File)
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Oil Down $2 as Investors Digest Weak US Job Data

FILE - This Nov. 6, 2013 file photo shows a Whiting Petroleum Co. pump jack pulling crude oil from the Bakken region of the Northern Plains near Bainville, Mont. (AP Photo/Matthew Brown, File)
FILE - This Nov. 6, 2013 file photo shows a Whiting Petroleum Co. pump jack pulling crude oil from the Bakken region of the Northern Plains near Bainville, Mont. (AP Photo/Matthew Brown, File)

Oil prices slid by more than $2 on Friday, on track for a fourth successive weekly drop after data showed that the US economy added fewer jobs than expected in July and weak Chinese economic data further weighed.

Brent crude futures fell $2.61, or 3.28%, to $76.91 a barrel by 11:52 a.m. ET. US West Texas Intermediate crude futures were down $2.82, or 3.7%, at $73.49, Reuters reported.

US crude futures fell by more than $3 per barrel during the session.

US job growth slowed more than expected in July as unemployment increased to 4.3%, pointing to possible weakness in the labor market and greater vulnerability to recession.

"We moved from a demand-driven market to a geopolitical one for maybe two days then we absolutely nosedived on all this economic data," said Tim Snyder, chief economist at Matador Economics, citing bearish Chinese data and Friday's weak US job data.

Economic data from top oil importer China and a survey showing weaker manufacturing activity across Asia, Europe and the United States raised the risk of a sluggish global economic recovery that would weigh on oil consumption.

Falling manufacturing activity in China also inhibited prices, adding to concerns about demand growth after June data showed imports and refinery activity lower than a year earlier.

Asia's crude oil imports in July fell to their lowest in two years, sapped by weak demand in China and India, data from LSEG Oil Research showed.

Oil investors are monitoring developments in the Middle East, where the killing of senior leaders of Iran-aligned militant groups Hamas and Hezbollah stoked fears that the region could be on the brink of all-out war, threatening to disrupt supplies.
Lebanon's Hezbollah said its conflict with Israel had entered a new phase and pledged a response after its top military commander was killed in an Israeli strike.
 

 



BP Nears Deals for Oil Fields, Curbs on Gas Flaring in Iraq

British Prime Minster Keir Starmer (L) welcomes Prime Minister of Iraq Mohammed Shia al-Sudani to 10 Downing Street in London, Britain, 14 January 2025. (EPA)
British Prime Minster Keir Starmer (L) welcomes Prime Minister of Iraq Mohammed Shia al-Sudani to 10 Downing Street in London, Britain, 14 January 2025. (EPA)
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BP Nears Deals for Oil Fields, Curbs on Gas Flaring in Iraq

British Prime Minster Keir Starmer (L) welcomes Prime Minister of Iraq Mohammed Shia al-Sudani to 10 Downing Street in London, Britain, 14 January 2025. (EPA)
British Prime Minster Keir Starmer (L) welcomes Prime Minister of Iraq Mohammed Shia al-Sudani to 10 Downing Street in London, Britain, 14 January 2025. (EPA)

Iraq and British oil giant BP are set to finalize a deal by early February to develop four oil fields in Kirkuk and curb gas flaring, Iraqi authorities announced Wednesday.

The mega-project in northern Iraq will include plans to recover flared gas to boost the country's electricity production, they said.

Gas flaring refers to the polluting practice of burning off excess gas during oil drilling. It is cheaper than capturing the associated gas.

The Iraqi government and BP signed a new memorandum of understanding in London late Tuesday, as Prime Minister Mohammed Shia al-Sudani and other senior ministers visit Britain to seal various trade and investment deals.

"The objective is to enhance production and achieve optimal targeted rates of oil and gas output," Sudani's office said in a statement.

Iraq's Oil Minister Hayan Abdel Ghani told AFP after the new accord was signed that the project would increase the four oil fields' production to up to 500,000 barrels per day from about 350,000 bpd.

"The agreement commits both parties to sign a contract in the first week of February," he said.

Ghani noted the project will also target gas flaring.

Iraq has the third highest global rate of gas flaring, after Russia and Iran, having flared about 18 billion cubic meters of gas in 2023, according to the World Bank.

The Iraqi government has made eliminating the practice one of its priorities, with plans to curb 80 percent of flared gas by 2026 and to eliminate releases by 2028.

"It's not just a question of investing and increasing oil production... but also gas exploitation. We can no longer tolerate gas flaring, whatever the quantity," Ghani added.

"We need this gas, which Iraq currently imports from neighboring Iran. The government is making serious efforts to put an end to these imports."

Iraq is ultra-dependent on Iranian gas, which covers almost a third of Iraq's energy needs.

However, Teheran regularly cuts off its supply, exacerbating the power shortages that punctuate the daily lives of 45 million Iraqis.

BP is one of the biggest foreign players in Iraq's oil sector, with a history of producing oil in the country dating back to the 1920s when it was still under British mandate.

According to the World Bank, Iraq has 145 billion barrels of proven oil reserves -- among the largest in the world -- amounting to 96 years' worth of production at the current rate.