Oil Heading For a Weekly Gain on Norway’s Supply Cuts

Oil prices retreated, to fall at the end of a week in which it made big gains due to the risk of a possible decrease in supplies from Norway by up to 25% due to a strike by workers in the sector.

Before the opening of European markets, Brent crude fell 8 cents to 43.26 dollars a barrel, after it gained more than 3% on Thursday. U.S. West Texas Intermediate crude fell 5 cents to $ 41.14 a barrel, after rising more than 3% on Thursday.

The two benchmarks are on track to gain about 10% this week, the first rise in three weeks, as prices rose in response to a strike by workers in the Norwegian oil sector.

A Norwegian oil company and union officials said they would meet with a state-appointed mediator today in an effort that both sides hope will lead to an end to the strike.

Market observers are preparing for the impact of US production by Hurricane Delta, which is expected to hit the Gulf Coast within hours. Almost 1.5 million barrels per day have been cut off so far.

“Non-OPEC production will take a big hit over the next two weeks and this will continue to push the rebalancing of the oil market,” said Edward Moya, chief market analyst at Oanda.

Mohamed Barkindo, Secretary-General of the Organization of the Petroleum Exporting Countries (OPEC), said yesterday, Thursday, that the worst for the oil market is over, following the collapse in prices and demand this year due to the Coronavirus pandemic.