(Bloomberg) — Oil was steady after a second weekly loss as traders weighed bigger-than-expected cuts by Saudi Arabia to its crude prices for Asia and any fallout from the toppling of the Syrian regime.
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Brent futures traded near $71 a barrel and West Texas Intermediate was above $67. Saudi Aramco cut its oil prices for January after OPEC+ further delayed a resumption of idled production, underscoring the weak market outlook. The fall of the Syrian government, meanwhile, is sending shockwaves through the Middle East and will be a blow to longtime backers Russia and Iran.
Crude has been confined to a tight range since mid-October, with bullish geopolitical developments in the Middle East and Ukraine countered by weak Chinese demand and ample supply. The market is facing a glut next year, meaning there is little room for a significant output boost from OPEC+.
Aramco will sell its flagship Arab Light crude grade at 90 cents per barrel above the regional benchmark to Asian buyers — the narrowest premium in four years. The state producer also cut prices for north-west Europe and the Mediterranean, while leaving those for North America unchanged.
In Syria, the collapse of Bashar Al-Assad’s regime has created a power vacuum, with multiple groups vying for control, raising the prospect of more upheaval and violence. Memories of Libya and Iraq loom large, where entrenched rulers were swept aside only for the countries to descend into deeper turmoil.
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