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Oil Updates — Crude Eases; Equinor and Exxon will expand their oil activities in Brazil; EU fails to convince Hungary of Russian embargo

RIYADH: Oil prices fell on Tuesday as Hungary resisted EU pressure for a ban on Russian oil imports, a move that would tighten global supply, and investors took profits at the following a recent rally.

Brent crude futures fell 22 cents, or 0.2%, to $114.02 a barrel at 0327 GMT, while US West Texas Intermediate crude futures fell 35 cents, or 0.3%, to $113.85 a barrel.

Both benchmarks had gained more than 2% on Monday, after jumping 4% on Friday.

Equinor and Exxon agree to expand oil business in Brazil

Equinor and Exxon Mobil Corp. have taken the first steps to expand an $8 billion oil development off the coast of Brazil, the Norwegian oil producer told Reuters.

The companies want to boost future production from the Bacalhau oilfield, Equinor’s largest project outside Norway with more than a billion barrels of oil, the company said.

A second drilling rig and a second floating production platform are being considered for the next phase, along with a gas pipeline more than 160 km long, three people familiar with the talks said.

For Exxon, Bacalhau could supply its first barrel of oil offshore Brazil, one of its key growth prospects, and new oil supply from low-carbon operations. First oil is due in 2024 from the company’s 220,000 barrel per day production vessel.

EU fails to convince Hungary to sign Russian oil embargo

EU foreign ministers on Monday failed in their effort to pressure Hungary to lift its veto on a proposed oil embargo on Russia, with Lithuania saying the bloc was ‘held hostage’ by a Member State”.

The ban on crude imports proposed by the European Commission in early May would be its toughest sanction yet in response to Moscow’s February 24 invasion of Ukraine and includes exclusions for EU states more dependent on Russian oil.

Germany, the EU’s biggest economy and a major buyer of Russian energy, has said it wants a deal allowing the oil embargo, which it says could last for years.

As expected, ministers failed to reach an agreement on Monday, EU foreign policy chief Josep Borrell said after the meeting, with ambassadors now tasked with brokering a deal.

“Unfortunately, it was not possible to reach an agreement today,” Borrell told reporters, saying Hungary presented its case based on economic, not political, concerns.

Some diplomats are now pointing to a May 30-31 summit as the time to agree a phased Russian oil ban, likely over six months, with a longer transition period for Hungary, Slovakia and the Czech Republic.

“I am convinced that we will find an agreement in the next few days,” said German Foreign Minister Annalena Baerbock.

(Contributed by Reuters)

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