Oil Falls as Strike Averted in Norway, Threat to Production Remains
Crude oil gave away its yesterday’s gains today after the strike, which threatened to completely halt all production in Norway, was averted by a government intervention. The government was concerned that such an event would hurt the country’s international reputation and willingness of foreign investors to bring money to Norway. The disagreement between workers and employers were not resolved, though, and a strike may yet happen.
Hanne Bjurstroem, the Norwegian minister of Labor, was not very pleased with the outcome of the event:
I am not impressed by how the employers’ group chose to use the lockout weapon. It signals that they don’t take the extensive consequences of a complete shutdown of the Norwegian continental shelf seriously. In my view, this is not the best way to deal with a legal labor conflict.
Crude also weakened as China’s imports fell.
August futures for delivery of crude oil fell as much as $1.22 (1.4 percent) to $84.77 per barrel by 14:13 on NYMEX. Brent grade of crude slid from $99.44 to $97.96 per barrel as of 19:00 GMT today on ICE.
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