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Agreement Approved for Italy’s Eni to Explore, Invest in Bahrain Bay Oilfield

The Shura Council in Bahrain approved an agreement between the NOGA and Eni for oil exploration and production. (Reuters)
The Shura Council in Bahrain approved an agreement between the NOGA and Eni for oil exploration and production. (Reuters)
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Agreement Approved for Italy’s Eni to Explore, Invest in Bahrain Bay Oilfield

The Shura Council in Bahrain approved an agreement between the NOGA and Eni for oil exploration and production. (Reuters)
The Shura Council in Bahrain approved an agreement between the NOGA and Eni for oil exploration and production. (Reuters)

The Shura Council, or Consultative Council, in Bahrain approved Sunday an agreement between the National Oil and Gas Authority (NOGA) and Italian firm Eni for oil exploration and production.

The move will kick off investment in the explored reserves of oil and gas in Bahrain Bay oilfield.

The Council of Representatives of Bahrain had in November approved the agreement.

Manama plans to drill the first exploratory well during the first quarter of 2020, given that the Kingdom is facing a mounting demand for gas. Estimates show that the demand for gas doubled with the launch of new industrial projects.

Bahrain had announced in April 2018 the discovery of the Bay oilfield, which boasts the Kingdom’s largest gas and oil reserves, estimated at around 80 billion barrels of oil and 20 trillion cubic meters of gas.

In 2018, Bahrain launched a fund to invest in energy with an initial capital of around one billion dollars in participation with world, Gulf and Bahraini institutions. The fund will invest in funding energy projects that require 3-5 years to reach the production phase.

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Gold Jumps, on Track for Best Week in Over a Year on Safe-haven Demand

FILE PHOTO: Gold bullions are displayed at GoldSilver Central's office in Singapore June 19, 2017. REUTERS/Edgar Su/File Photo
FILE PHOTO: Gold bullions are displayed at GoldSilver Central's office in Singapore June 19, 2017. REUTERS/Edgar Su/File Photo
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Gold Jumps, on Track for Best Week in Over a Year on Safe-haven Demand

FILE PHOTO: Gold bullions are displayed at GoldSilver Central's office in Singapore June 19, 2017. REUTERS/Edgar Su/File Photo
FILE PHOTO: Gold bullions are displayed at GoldSilver Central's office in Singapore June 19, 2017. REUTERS/Edgar Su/File Photo

Gold prices rose over 1% to hit a two-week peak on Friday, heading for the best weekly performance in more than a year, buoyed by safe-haven demand as Russia-Ukraine tensions intensified.

Spot gold jumped 1.3% to $2,703.05 per ounce as of 1245 GMT, hitting its highest since Nov. 8. US gold futures gained 1.1% to $2,705.30.

Bullion rose despite the US dollar hitting a 13-month high, while bitcoin hit a record peak and neared the $100,000 level.

"With both gold and USD (US dollar) rising, it seems that safe-haven demand is lifting both assets," said UBS analyst Giovanni Staunovo.

Ukraine's military said its drones struck four oil refineries, radar stations and other military installations in Russia, Reuters reported.

Gold has gained over 5% so far this week, its best weekly performance since October 2023. Prices have gained around $173 after slipping to a two-month low last week.

"We understand that the price setback has been used by 'Western world' investors under-allocated to gold to build exposure considering the geopolitical risks that are still around. So we continue to expect gold to rise further over the coming months," Staunovo said.

Bullion tends to shine during geopolitical tensions, economic risks, and a low interest rate environment. Markets are pricing in a 59.4% chance of a 25-basis-points cut at the Fed's December meeting, per the CME Fedwatch tool.

However, "if Fed skips or pauses its rate cut in December, that will be negative for gold prices and we could see some pullback," said Soni Kumari, a commodity strategist at ANZ.

The Chicago Federal Reserve president reiterated his support for further US interest rate cuts on Thursday.

On Friday, spot silver rose 1.8% to $31.34 per ounce, platinum eased 0.1% to $960.13 and palladium fell 0.6% to $1,023.55. All three metals were on track for a weekly rise.