Oil Updates — Crude down; US scraps oil drilling auctions; Norway cuts oil fund spending

RIYADH: Oil prices dropped more than 1 percent on Thursday in a volatile week as economic concerns and recession fears dogged global financial markets, outweighing supply concerns and geopolitical tensions in Europe.

Brent crude futures slipped $1.25, or 1.2 percent, to $106.26 a barrel by 0303 GMT. West Texas Intermediate crude futures fell $1.24, or 1.2 percent, to $104.47 a barrel.

US scraps three offshore oil and gas drilling auctions

The Biden administration on Wednesday said it would scrap three planned sales of offshore oil and gas leases in Alaska and the Gulf of Mexico.

In a statement, the Department of Interior said it was not moving forward with an auction for drilling rights in the Cook Inlet off the coast of Alaska “due to lack of industry interest in leasing in the area.”

It also said two sales in the Gulf of Mexico would be canceled due to “conflicting court rulings.”

The three sales were the last to be held under a five-year plan for leasing in federal waters on the outer continental shelf. That plan expires in June, and the administration has not finalized a new program.

President Joe Biden paused drilling auctions shortly after taking office pending an analysis of their impacts on the environment and value to taxpayers. Last June, a federal judge in Louisiana ordered a resumption of auctions.

Norway cuts 2022 oil fund spending to $36 billion

The Norwegian government on Thursday trimmed its projected fiscal spending for 2022 as it sought to rein in public expenses at a time of rising inflation and interest rates.

The center-left minority coalition now plans to spend 352.2 billion Norwegian crowns ($35.90 billion) from the country’s $1.2 trillion sovereign wealth fund, down from 355.1 billion planned in January.

(With input from Reuters)