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#MoneyBeat Crude Falls on Oversupply Concerns—Energy Journal

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A daily digest of The Wall Street Journal’s coverage of energy companies, commodity markets and the forces that shape them.

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OIL EDGES DOWN DESPITE WEAKER DOLLAR

Investors are bracing for bearish official U.S. oil production and inventory data due later Wednesday, following a slew of reports of rising U.S. shale output.

The expectations for surging U.S. production continued to weigh on oil prices on Wednesday, despite a weaker dollar.

The WSJ’s Spencer Jakab reports that U.S. energy companies may be done with exercising financial discipline and aim to plow all their cash into pumping out an avalanche of oil.

Brent crude, the global benchmark, was down 0.32% at $62.52 a barrel on London’s Intercontinental Exchange. On the New York Mercantile Exchange, West Texas Intermediate futures were trading down 0.63% at $58.84 a barrel.

Analysts said crude futures didn’t tumble further because of the weaker dollar. The Wall Street Journal Dollar Index, which tracks the dollar against a basket of other currencies, fell 0.15% to 83.61 on Wednesday.

As oil is priced in dollars, it becomes less expensive for holders of other currencies as the greenback depreciates.

The gloom in the market persisted even after assurances from major producers that efforts by the Organization of the Petroleum Exporting Countries and its allies to eliminate about 2% global supply could bolster crude.

Saudi Arabia’s Oil Minister Khalid al-Falih said Wednesday he was confident about OPEC’s collaborative efforts, Reuters reports.

“I am confident that our high degree of cooperation and coordination will continue and bring the desired results,” Mr. Falih said at an industry conference in Riyadh.

TRUMP ADMINISTRATION PLANS TO UNDO METHANE-EMISSION RULE

The Trump administration is pushing to roll back an Obama-era climate regulation aimed at cutting emissions of methane from drilling operations on federal lands.

ASIA’S GROWING APPETITE FOR GAS MAY SPUR NEW LNG PROJECTS

Despite persistent reports of a global gas glut, soaring gas demand from China, India and Southeast Asia is absorbing the overflow, paving the way for new production from East Africa and elsewhere.

RUSSIAN FIRM IS CLOSE TO DRILLING DEAL WITH SAUDI ARAMCO

The Russian Direct Investment Fund on Wednesday said it is close to completing a deal with Saudi Arabia Oil Co., or Saudi Aramco, to invest in oilfield services firm Eurasia Drilling.

INSIDE THE BRIBERY SCANDAL SWEEPING THE OIL INDUSTRY

The Wall Street Journal’s Sarah Kent and Eric Sylvers take readers behind the scenes of one of the biggest bribery scandals the oil industry has ever encountered.

Italian prosecutors are pursuing a criminal trial against Royal Dutch Shell PLC and the chief executive of Italian oil company Eni SpA, alleging that the firms paid a bribe of around $1 billion to obtain a coveted oil block in Nigeria.

The move to prosecute the two companies revolves aroundthe firms’ 2011 deal to buy an Atlantic Ocean oil discovery believed to hold 9 billion barrels of crude.

Eni paid a sum of $1.1 billion to the Nigerian government for the block, but the money was later transferred to bank accounts belonging to a former Nigerian oil minister, Dan Etete.

Prosecutors are investigating 11 people including Eni’s current CEO, Claudio Descalzi and his predecessor Paolo Scaroni, while Shell is named as a corporation. Italian prosecutors say that Messrs. Scaroni and Descalzi knew the money was destined to be paid as kickbacks to several people, including Mr. Etete.

Eni and Shell both deny wrongdoing, saying they simply paid the government and didn’t know the money would be used for bribes.

FUTURECURVE

Today: Three important oil-industry groups hold a symposium in Riyadh: The International Energy Forum, the International Energy Agency and the Organization of the Petroleum Exporting Countries. Saudi energy minister Khalid al-Falih, Russia’s energy minister Alexander Novak and OPEC’s secretary general Mohammad Sanusi Barkindo will speak.

Feb. 20-22: The Energy Institute hosts the International Petroleum Week conference in London. The speakers include BP Chief Executive Bob Dudley and Dr. Faith Birol, executive director of the International Energy Agency.

March 5-9: Cambridge Energy Research Associates hosts the CERAWeek energy conference in Houston. The speakers include IHS Markit Vice Chairman Dr. Daniel Yergin and Amin Nasser, president and CEO of Saudi Arabia Oil Co., or Saudi Aramco.

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