Oil prices fall on signs of rising supplies

Oil prices fall on signs of rising supplies

Brent crude futures fell $2.24 a barrel to $72.81 a barrel as of 1:26 p.m. EST (1726 GMT), while USA futures were down $1.76 a barrel at $63.56. Saudi Arabia raised production by 150,000 barrels to 10.68 million a day, the highest in Bloomberg data going back to 1962, while Iranian volumes slipped by 10,000 barrels a day to 3.42 million, the lowest since March 2016. The contract fell 1.8% on Tuesday, at one point touching its lowest since August 24 at $75.09.

"In spite of the increase of crude oil inventories, crude futures prices are being supported by the inventory decline in refined products", said Andrew Lipow, president of Lipow Oil Associates in Houston. EIA forecast that US crude oil production to increase by 1 million barrels per day in 2019.

The market is growing confident output from other sources, including Saudi Arabia/Opec, Russia and the US, can offset the declines.

President Donald Trump's threat to sanction foreign firms that buy Iranian barrels beyond his November 4 deadline has wiped roughly a third of Iran's oil exports off the market.

While comments from Saudi Arabian Energy Minister Khalid Al-Falih pledged to play responsible role in energy market and announced possible partnership with Russian Federation easing investors worries about Saudi cutting Crude supply in retaliation to U.S. intervention in matters relating to death of Journalist Khashoggi, oil market saw bearish pressure post comments from Saudi Arabia's OPEC Governor who said that slower global growth could mean lower demand for crude oil and market could face oversupply in current quarter. Namely, US production levels.

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However, a senior Trump administration official on dismissed the report as untrue, a CNBC reporter said in a post on Twitter. The two leaders agreed the trade dispute "should be handled properly through substantial consultation", Lu said.

Net U.S. crude imports fell last week by 639,000 barrels per day. -China trade war kept pressure on the market.

Oil extended its slide to six-month lows as the US dialed down its crackdown on Iranian exports and American supplies surged, easing concerns of an impending shortage. "Meanwhile, the recent build in inventories was likely due to outsized PADD2 maintenance in the US", Malek writes, in a note to clients Thursday. "The second one is global economic growth momentum slowing down", said IEA chief Fatih Birol. WTI picked up 0.26 dollar to settle at 67.59 dollars a barrel.

Anticipating a fall in global supply, the Organization of the Petroleum Exporting Countries raised production by 400,000 barrels per day to 33.31 mln bpd in October, the highest since 2016, led by Saudi Arabia, the United Arab Emirates, and Libya, a report by Reuters said. Still, U.S. crude oil futures prices lost 2.2 percent for the week, marking the third straight weekly loss.

There are also signs of a slowdown in global trade, with container and bulk freight rates dropping after rising for most of 2018, according to reports.

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