Miércoles, 22 May, 2019

Oil up Thursday after US inventories fall, Saudi cuts to Asia

Oil prices edge up in anticipation of extended crude output cut Good news to Nigeria as Saudi announces oil market rebalancing after years of oversuplus
Manuel Armenta | 12 May, 2017, 15:02

The decline in USA crude oil inventories is likely due to the increase in gross inputs to refineries in April.

By 11:12 a.m., US crude futures CLc1 were up $1.30, or 2.8 percent, at $47.18 a barrel, and Brent crude LCOc1 rose 2.5 percent, or $1.25, to $49.98 a barrel.

The bank also said that a fall by 5.3 million barrels in USA crude inventories C-STK-T-EIA this week to 522.5 million barrels was "providing some fundamental support for prices".

Reuters- Oil prices rose on Wednesday after a larger-than-expected fall in USA crude inventories but failed to recoup last week's losses due to concerns about rising output from the United States, Libya and Nigeria.

"We saw the biggest draw in inventories for the year last week with stockpiles down more than 5 million barrels".

Oil output in Kazakhstan totaled 1.7 million barrels per day in 2016, according to the EIA.

West Texas Intermediate for June delivery climbed 3.2 per cent, the most since December 1, to settle at $US47.33 a barrel on the New York Mercantile Exchange.

Thirteen OPEC members and 11 non-OPEC countries, led by Russian Federation, had agreed on November 30, 2016 to reduce their production by about 1.8 million barrels per day (bpd) for six months beginning from January in an effort to drain a glut of crude that held down prices for over two years.

Earlier this week, Saudi Arabian oil minister Khalid al-Falih said he expects OPEC's cuts to be continued to the end of the year or possibly longer.

Investing.com offers an extensive set of professional tools for the financial markets. Government bond yields rose as rising oil prices reinforced expectations inflation would pick up.

Oil prices pared gains on Thursday after the release of the report to trade at less than $51 a barrel LCOc1 , below the $60 level that top OPEC producer Saudi Arabia would like to see.

"While the API data is supportive, rising US production will maintain pressure on prices", said Jonathan Barratt, chief investment officer at Ayers Alliance Securities in Sydney.

"Chief among (the) oil market's worries is that the renewed rise in U.S. oil production is reducing the speed at which the supply surplus is being eroded", Fawad Razaqzada, market analyst at Forex.com, said in a note.

An extension of the supply deal beyond June looks likely but its effectiveness will remain questioned."Other nations, like Libya, have also increased oil output in recent months.Libyan oil production has risen to just below 800,000 bpd - its highest since 2014 - as the OPEC member pushes up production from the newly restarted Sharara and El Feel fields, a Libyan oil source told Reuters".

US crude oil production C-OUT-T-EIA has already risen by over 10 percent since its mid-2016 trough, to more than 9.3 million bpd, close to levels of top producers Russian Federation and Saudi Arabia.

Oil prices have increased after Saudi oil giant Aramco announced cuts in supplies to the Asia market.

Despite an overall drop in OPEC crude production in April, Saudi Arabia's output increased, according to a monthly report from the cartel out Thursday.