Crude Oil Hold Recent Gains Ahead Of Inventories

Randal Sanchez
February 24, 2018

On Thursday, Brent crude oil futures were trading at just over $65 per barrel, virtually unchanged on the trading session as at 1200 GMT.

With US oil output surging to a record level of over 10 million b/d last week, oil prices are under pressure from growing sentiment that US flows are undermining OPEC-led efforts to drain the market of high historic stock levels. On the price of oil, the company said it was anticipating an average price for Brent at $60 per barrel for 2018.

The American Petroleum Institute's February 9 report indicated USA crude oil inventory at 3.9 million barrels as against the expected 2.8 million barrels.

The Federal Reserve today releases minutes of its January 30-31 meeting later today as investors look for further insight on inflation and interest rates under new chairman Jerome Powell.

"Oil is getting support from a rebound in global stock markets and a weak dollar, but the upside is limited due to a projection for rising USA production", Tomomichi Akuta, senior economist at Mitsubishi UFJ Research and Consulting in Tokyo, told Reuters. Oil in NY dipped on concern that expanding United States stockpiles knocked the steam out of Opec's cuts for another week.

Snow winding down this morning; another storm expected this weekend
ADOT advised travelers headed to the Grand Canyon to allow plenty of extra travel time because of snow and limited visibility. According to the warnings, travel Saturday night through early Sunday morning is expected to be extremely hard .

The Energy Information Administration is scheduled to release its weekly inventory report today, a day later than usual due to the US President's Day holiday earlier this week.

West Texas Intermediate (WTI) crude CLc1 futures rose $1.09, or about 1.8 percent, to settle at $62.77 a barrel. Rising U.S. shale output has hindered efforts by the Organization of the Petroleum Exporting Countries (OPEC) and other producers, led by Russian Federation, to reduce bloated global inventories and prop up oil prices by cutting output.

Oil gained some support from a rise on Wall Street markets. By contrast, the American Petroleum Institute was said to report they fell by 907 000 barrels.

"Oil prices and the S&P have been highly correlated, of late, with economic strength translating into improved company performance and higher energy demand", said John Kilduff, partner at investment manager Again Capital in NY.

WTI Crude Oil (Light Sweet) price at NYMEХ Stock Exchange down by 0.21% to $61.05 per barrel. Analysts had forecast a smaller decline of 1.633-million-barrels. Declining storage in Cushing boosted prices, and "we will continue to see that as crude is directed to the Gulf Coast" for export, he said.

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