Oil extends losses as Texas plans to scale up production

As Texas energy producers started planning to reopen oil and gas fields blocked by freezing conditions, oil prices dropped from recent highs for a second day on Friday.

Brent crude futures dropped $1.16, or 1.8 percent, to $62.77 a barrel by 1150 GMT, while crude futures in the United States West Texas Intermediate (WTI) fell $1.42, or 2.4 percent, to $59.10 a barrel.

According to experts, extremely cold weather in Texas and the Plains states has cut crude oil demand by up to 4 million barrels per day (bpd) and 21 billion cubic feet of natural gas.

In the wake of power outages and extreme cold, Texas refiners suspended about a quarter of the nation’s oil production.

However, industries in the area were supposed to brace for production restarts on Friday as electric power and water supplies resume slowly, sources said.

In the week to February 12, before the freeze, oil dropped amid a sudden fall in US crude stockpiles. Inventories dropped by 7.3 million barrels to 461.8 million barrels, the Energy Information Administration announced on Thursday, their lowest since March.

The US said it was prepared to speak to Iran about the return of both nations to a 2015 deal aimed at stopping Tehran from possessing nuclear weapons.

If the thawing ties could boost the possibility of the reversal of sanctions levied by the former US administration, observers did not anticipate that the Iranian oil sanctions would be repealed in the immediate future.

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