*Osama Suleiman from Vienna
According to Oil Price's report, Saudi Arabia aims to increase production capacity by 1 million bpd by 2023 through boosting investment in a number of offshore fields to offset declines in mature fields. Saudi Aramco has signed a key contract with Baker Hughes to help boost production in the Murjan oilfield.
The field is the first project within three projects to expand the maritime fields in the Kingdom. Baker Hughes will supply Aramco with drilling, pipe and engineering services.
Under the contract, the field will be expanded this month. Baker Hughes' drilling services will include drilling techniques, reserve management services and rotary drilling.
Oil Price's report added that the Joint Technical Committee for representatives of "OPEC" and non-members of the "OPEC" will discuss on Tuesday how the group can-distribute among themselves-increase production by one million barrels per day, which was agreed in June in Vienna.
It pointed out that the increase in production implemented by OPEC in cooperation with the independents aimed at addressing the state of market concerns, especially the concern of consumers about the situation of tightness and hardness in the oil market, in view of the high prices of crude oil and gasoline.
The report says that the June decision implies a redistribution of quotas among producing countries to achieve a 100 percent collective compliance rate.
The two largest countries in the global production system, Saudi Arabia and Russia, are seeking to increase production by about 400 thousand barrels to Saudi Arabia and 300 thousand barrels per day to Russia.
According to the report, Iran is facing great difficulties due to expectations of decline in production and exports as a result of the US sanctions, as it is resisting this by claiming that no country could exceed the production and export quotas of other Member States under any circumstances - according to its claim.
Crude oil prices fell sharply last week after the Energy Information Administration (EIA) revealed a sudden increase in gasoline inventories, which rose 1.8 million barrels to 234.62 million barrels, while analysts expected a decline of 810 thousand barrels. This is suggesting that the summer driving season is nearing an end and could lead to a period of weak demand and thus strong growth in crude stocks.
Saudi oil shipments to the United States are rising, where Saudi oil exports to the US market jumped to more than 1 million barrels per day last week, "average four weeks" for the first time since 2017. Global demand for mobile offshore drilling platforms will increase by 13 per cent by 2020 as the oil industry escalates for offshore exploration.
In a related context, oil analysts expected crude oil prices to continue their price gains due to anticipation of the US sanctions and its impact on the reduction of Iranian oil exports, as well as the increased risk of geopolitical factors, especially with the impact of violent protests in Iraq.
Analysts pointed out that the escalation of the US-China trade war and the increase in the scope of tariffs between the two countries inhibits the achievement of wide price gains, in addition to the rise of the dollar, which is linked to the inverse relationship with crude oil prices.
Furthermore, Bill Farren Price, director of Petroleum Policy Intelligence, explained to the Economist that the uncertainty dominated the crude oil markets and increased the chances of rising prices, especially in light of the anticipation of the application of economic sanctions on Iran, which aims to the US administration to reduce Iranian oil exports to zero.
The market remains under pressure to continue the impact of geopolitical risks, especially in view of the violent turmoil currently taking place in OPEC's second-largest oil exporter, Iraq.
He was hoping that the meetings of producers in OPEC and the independents in Algeria and then in Vienna would succeed in spreading confidence in the oil market and supporting the achievement of a sustainable balance.
Moreover, Vittorio Musazzi, director of international relations at the Italian Energy Company "Snam", said to the Economist that the increase in shipments of Saudi crude to the US market reflects the strong demand for Saudi oil, as well as the availability of large capacities in reserves and in response to market changes through rapid productivity increases.
Musazzi pointed to Saudi Arabia's keenness to react quickly to the demands of top oil consuming countries, led by the United States and India, through providing more supplies that secure the oil supply, easing fears in the market and keeping prices at moderate and favorable levels that support balance and stability, meeting the aspirations of producers and consumers alike and stimulating global economic growth.
In addition, Gulmira Rzayeva, a senior researcher at Azerbaijan's Strategic Energy Center, said to the Economist that the chances of rising prices are significant, as she noted that many banks and financial institutions adjusted their expectations for prices raise during the current and the next years.
Rzayeva added that the meeting of the technical committee of "OPEC" and outside within days will pave the way for a successful meeting in Algeria to monitor the reduction of production by the end of this month.
She pointed out that the biggest responsibility now lies with the OPEC producers' alliance and outside it by conducting continuous evaluation of supply and demand developments and helping the market to remain under a safe umbrella of new investments and abundant production.
Crude oil prices ended last week with little change as US crude fell slightly hurt by weak equity markets. Brent crude, however, has risen with geopolitical support, such as violent protests in Iraq.
According to Reuters, US benchmark West Texas Intermediate crude futures ended the trading session low two years to settle at $ 67.75 per barrel. While Brent crude was up 33 cents at $ 76.83 a barrel.
US crude ended the week losing nearly 3 per cent, while Brent fell 0.8 per cent.
The US dollar rose against a basket of major currencies after a report showed strong job growth in the United States in August, which is boosting expectations for a third increase in US interest rates this year when the Fed meets later this month.
The rise of the greenback makes commodities priced in dollars, such as oil, more expensive for holders of other currencies.
US energy companies halted oil drilling for the second time in three weeks, with the number of rigs sluggish over the past three months as well as crude prices.
Baker Hughes Energy Services, in its closely monitored weekly report, stated, "The drilling companies stopped the operation of two oil diggers in the week ending September 7, bringing the total number of rigs to 860."
The number of oil drilling rigs in the US, a preliminary indicator of future production, rose by one in August after three excavators increased in July and after a one-ton drop in June. But higher than a year ago when it hit 756 diggers as energy companies increased production in anticipation of higher prices in 2018 than in previous years.
The average price of US oil contracts since the beginning of the year is $ 66.47 per barrel, compared to $ 50.85 in 2017 and $ 43.47 in 2016.
The US crude prices were affected by an increase in refined fuel stocks, the strength of the dollar, weaker equity markets and a weaker-than-expected effect of Gordon's storm on oil production in the Gulf Coast region.
