Oil prices fall 3% as U.S., Libyan, Norwegian supplies resume
By Laura Sanicola
NEW YORK (Reuters) - Oil prices fell about 3% on Monday when force majeure was lifted on Libya's largest oil field, a Norwegian strike that affected production ended and U.S. producers restoring production after Hurricane Delta began.
Brent crude <LCOc1> declined $ 1.13, or 2.6%, to $ 41.72 a barrel. The US West Texas Intermediate <CLc1> closed at 2.9% or $ 1.17 at $ 39.43.
Production in Libya, a member of the Organization of Petroleum Exporting Countries (OPEC), is expected to rise to 355,000 barrels per day (bpd) after force majeure was lifted on the Sharara oil field on Sunday.
Rising Libyan production will pose a challenge to OPEC + - a group made up of OPEC and allies including Russia - and its efforts to stem supply to support prices.
"Getting online when you don't need one of these kegs is a big part of the production, which is bad news for the supply side of the equation," said Bob Yawger, director of energy futures for Mizuho in New York.
Hurricane Delta, which last week inflicted the biggest blow in 15 years on power generation in the US Gulf of Mexico, was downgraded to a post-tropical cyclone over the weekend.
Workers returned to production platforms on Sunday, and French oil major Total <TOTF.PA> restarted its 225,500 barrels a day at the Port Arthur refinery in Texas.
The Louisiana Offshore Oil Port (LOOP) announced Monday that it has resumed operations at its offshore marine terminal and that supplies at the Clovelly Hub have not been interrupted.
The prices for both contracts in the first month rose more than 9% last week. This was the largest weekly increase for Brent since June. However, both fell Friday after Norwegian oil companies signed a deal with union officials to end a strike that threatened to cut the country's oil and gas production by nearly 25%.
Prices have also been put under pressure by a jump in new COVID-19 cases, which has heightened the specter of further lockdowns that could dampen demand for oil.
Infections are at record levels in the American Midwest. In Europe, UK Prime Minister Boris Johnson announced new coronavirus lockdown measures and Italy is preparing new nationwide restrictions.
(This story corrects the settlement prices in paragraph 2)
(Additional reporting by Bozorgmehr Sharafedin in London, Florence Tan in Singapore; editing by Marguerita Choy and David Goodman)
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