Stock market loses N111 billion as investors offload Nestle, FCMB and others

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By Adedapo Adesanya

Oil prices stabilized on Thursday as traders weighed a deteriorating economic outlook against potential output cuts next week.

Brent crude futures fell 83 cents to trade at $88.49 a barrel, while U.S. crude futures fell 92 cents to end at $81.23 a barrel.

Leading members of the Organization of the Petroleum Exporting and Allied Countries (OPEC+) have begun discussing an oil production cut at their next meeting on Oct. 5.

Brent and WTI are on track to rise around 3% for the week, their first weekly gain since August, after hitting nine-month lows earlier in the week.

For the whole of September, Brent is expected to fall 8%, down for a fourth month.

During the third quarter, Brent plunged 23%, its first quarterly loss since the fourth quarter of 2021.

WTI is expected to fall 9% in September, its fourth monthly decline, and it fell 23% in the quarter, the first quarterly decline since the period ending in March 2020 when COVID-19 depressed demand.

This week, Russia will likely propose to OPEC+ to cut oil production by around 1 million barrels per day.

Analysts have pointed out that right now the oil market is teetering between US Fed-induced demand destruction and tight oil supply.

Amid so much uncertainty, analysts also believe that unless the market gets more clarity from OPEC+ on the likely size of any adjustment and what it means for previously missed quotas, the market will be influenced upwards.

Prices were also under pressure as the threat from Hurricane Ian receded, with U.S. oil production expected to return in the coming days after the Gulf of Mexico shut down about 158,000 barrels a day on Wednesday.

In China, the world’s largest crude oil importer, travel during the upcoming national holiday week is set to hit its lowest level in years as the country’s zero-COVID rules keep people at home while economic hardship puts the brakes on expenses.

The U.S. dollar index fell again on Thursday, easing 20-year highs, indicating a renewed appetite for risk among investors.

Further support for oil prices could come from the United States, which announces new sanctions against companies that have facilitated sales of Iranian oil.

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