Oil Trades Near $50 After First Weekly Gain in 2 Months

04:30 PM @ Monday - 19 January, 2015
Oil dropped after capping its first weekly gain in two months as investors weigh rising OPEC against speculation supply from outside the group will slow.

Prices slid at least 1.2 percent in London and New York. Iraq is pumping at a record pace of 4 million barrels a day, Oil Minister Adel Abdul Mahdi said. Non-OPEC nations will boost output this year at a weaker rate than previously forecast, according to the International Energy Agency.

Crude slumped almost 50 percent last year as the U.S. pumped oil at the fastest rate in more than three decades while OPEC resisted calls to cut supply. U.S. producers idled a record number of drill rigs during the past six weeks, according to data from Baker Hughes Inc.

“The bigger picture remains from a fundamental point-of-view,” Ric Spooner, a chief strategist at CMC Markets in Sydney, said by phone. “We have a supply surplus and there is yet to be any significant news of reduction in capacity so the market remains very vulnerable to further price decline.”

West Texas Intermediate for February delivery, which expires on Jan. 20, dropped as much as 71 cents to $47.98 a barrel on the New York Mercantile Exchange and was at $48.03 at 4:07 p.m. in Singapore. The more-active March future fell 64 cents to $48.49. The volume of all futures traded was about 1 percent below the 100-day average. Prices rose 0.7 percent last week.

Iraq Output

Brent for March settlement slid as much as 60 cents to $49.57 a barrel on the London-based ICE Futures Europe exchange. It gained 3.9 percent to $50.17 on Jan. 16. The European benchmark crude was at a premium of $1.22 to WTI for the same month.

Iraq plans to increase crude exports to 3.3 million barrels a day this year, including sales from the semi-autonomous Kurdish region in the north, Abdul Mahdi said. The OPEC producer pumped 3.35 million barrels a day in December, according to the oil marketing organization SOMO.

In Saudi Arabia, OPEC’s biggest producer, oil exports rose to a seven-month high in November when it led OPEC to keep the group’s production quota unchanged. Overseas shipments climbed to 7.3 million barrels a day from 6.9 million barrels in October, according to data on the website of the Joint Organisations Data Initiative.

OPEC, which supplies about 40 percent of the world’s crude, maintained its collective quota of 30 million barrels a day at a meeting in November. The 12-member group pumped 30.2 million a day in December, according to estimates compiled by Bloomberg.

Rig Count

U.S. output rose to 9.19 million barrels a day through Jan. 9, the fastest pace in weekly records dating back to January 1983, data from the Energy Information Administration show.

The number of operating oil rigs in the U.S. has declined by 209 since Dec. 5, the steepest six-week drop since Baker Hughes Inc. began tracking the data in July 1987. The count was down 55 in the week ended Jan. 16 to 1,366.

The U.S. oil boom has been driven by a combination of horizontal drilling and hydraulic fracturing, which has unlocked supplies from shale formations including the Eagle Ford and Permian in Texas and the Bakken in North Dakota.

The IEA lowered its non-OPEC supply growth estimate by 350,000 barrels a day, the first reduction since the 2015 forecast was introduced in July. Half the cut is from Colombian output while effects on U.S. production are so far “marginal,” the Paris-based group, which advises 29 nations on energy policy, said in its monthly market report on Jan. 16.
Nguồn:
LinkedInPinterest

OTHERS

More News