Crude slips on recession fears; Russia to take control of Sakhalin-1 oil and gas project

Oil prices slipped in Asian trade on Friday as recession fears continued to weigh on sentiment, though worries over tight global supplies capped price declines.

Brent crude futures fell 25 cents, or 0.2 percent, to $104.40 a barrel by 0311 GMT, dropping away after a near 4 percent rebound on Thursday.

US West Texas Intermediate crude slipped 41 cents, or 0.4 percent, to $102.32 a barrel, having settled 4.2 percent higher a day earlier.

Both contracts are set for their second straight weekly loss.

Trade this week was marked by a sharp sell-off on Tuesday, when WTI slid 8 percent and Brent tumbled 9 percent. Brent’s $10.73 drop was the third biggest for the contract since it started trading in 1988.

Moscow to take control of Sakhalin-1 oil and gas project

A senior Russian lawmaker said on Thursday that Moscow would take control of the Sakhalin-1 oil and gas project in which ExxonMobil, Japan’s SODECO and India’s ONGC Videsh are partners, a week after taking over the neighboring Sakhalin-2.

Pavel Zavalny, head of the energy committee in Russia’s lower house of parliament, said the move was an obvious next step.

However, Kremlin spokesman Dmitry Peskov told reporters no decision had been taken on Sakhalin-1.

Petroecuador lifts force majeure on flagship Oriente crude

Ecuador’s state-run oil firm Petroecuador has lifted the force majeure declaration it enforced over exports of its flagship crude Oriente following the end of anti-government protests last week, it said in a notification to clients seen by Reuters.

In a notification to clients this week signed by International Trade Manager Pablo Noboa, Petroecuador said it would lift the force majeure on Oriente with immediate effect.

The company added that operations linked to its Napo crude production had also been affected by protests, which will require the rescheduling of some cargoes originally planned to be exported in July.

“Once the force majeure has been overcome, we will officially notify parties to coordinate the operational restart and rescheduling,” said the document.

Protests in the country erupted on June 13 and ran for more than a fortnight, leaving eight dead and severely impacting Ecuador’s oil industry, its main source of income. Demonstrators forced fuel price cuts and legal reforms in the oil and mining industries.

The protests, led by indigenous leaders, cut the Andean country’s oil output by half of the 500,000 barrel-per-day pre-conflict level, and motivated a wide force majeure declaration, ultimately enforced over Petroecuador’s Oriente crude exports.