Oil prices slip more than 1pc after Norway oil worker strike ends

NEW YORK: Oil prices slipped more than 1% on Friday after an oil worker strike in Norway ended, which should boost crude output, even though production was still reduced in the United States for Hurricane Delta.

Brent futures fell 64 cents, or 1.5%, to $42.70 a barrel by 1:36 p.m. EDT (1736 GMT), while US West Texas Intermediate (WTI) crude fell 71 cents, or 1.7%, to $40.48.

Norwegian oil firms have struck a wage bargain with labour union officials, ending a strike that had threatened to cut the country's oil and gas output by close to 25% next week, negotiators for each side told Reuters.

Despite Friday's price declines, oil futures were still up for the week due to earlier gains from worries about global oil supplies from the Norwegian strike and the hurricane headed for the US Gulf Coast.

Both benchmarks were up about 9% this week, which would be their first increase in three weeks and the biggest weekly rise for Brent since June.

Rystad's Head of Oil Markets Bjornar Tonhaugen said "These $40+ price levels are as fragile as glass" once the strike is resolved and the hurricane goes away.

Also weighing on prices was doubt from US Senate Republicans that a coronavirus economic stimulus deal can be reached before the Nov. 3 election.

Earlier in the day, oil prices briefly turned positive after US House Speaker Nancy Pelosi said she would resume talks on a stimulus package with Treasury Secretary Steven Mnuchin.

Hurricane Delta, meanwhile, has shut 1.67 million barrels per day, or 92%, of US Gulf of Mexico oil output, the most since 2005 during Hurricane Katrina.

Looking ahead, JP Morgan said that a worsening global oil demand outlook due to a potential rise in coronavirus cases this winter would likely prompt the Organization of the Petroleum Exporting Countries (OPEC) to reverse a planned easing of oil cuts in 2021, with Saudi Arabia offering deeper cuts below its current quota.