Venezuela Crude Oil

now browsing by tag

 
 

Oil prices rise on Venezuela protests, strong Asian demand

Reuters

Demonstrators clash with members of Venezuelan National Guard during a rally demanding a referendum to remove Venezuela’s President Nicolas Maduro, in San Cristobal, Venezuela October 26, 2016. REUTERS/Carlos Eduardo Ramirez
By Henning Gloystein | SINGAPORE

SINGAPORE Oil prices rose on Thursday, lifted by concerns over Venezuela’s stability as well as by firm demand in Asia, although doubts over OPEC’s ability to organize a coordinated production cut still weighed on markets.

International Brent crude oil futures LCOc1 were trading at $50.18 per barrel at 0655 GMT (2:55 a.m. ET) on Thursday, up 20 cents, or 0.4 percent, from their last close.

WTI futures CLc1 were at $49.33 per barrel, up 15 cents, or 0.31 percent, from their previous settlement.

Traders said concerns over political stability in Venezuela, a major oil producer, had lifted markets.

In Asia, South Korea’s S-Oil Corp (010950.KS) said on Thursday that it expected refinery demand to rise in the region.

As crude is the main feedstock for oil refineries, strong refining activity tends to be price supportive of crude.

In the United States, WTI futures received support from a 553,000-barrel draw in crude inventories to 468.16 million barrels. [EIA/S]

But some analysts said that the drop in stocks was misleading.

“The decline of 553,000 barrels last week was centered on the west coast, which is isolated from the rest of the network. Inventories actually increased along the East and Gulf Coasts,” ANZ bank said on Thursday.

Traders also said that oil prices were being held back on doubts that the Organization of the Petroleum Exporting Countries (OPEC) and non-OPEC producers like Russia will be able to effectively coordinate curbs in output to prop up prices.

“Investors remain uncertain as to whether OPEC can implement the tentative agreement to cut production,” ANZ bank said.

A cut is being pushed by Saudi Arabia, OPEC’s biggest producer, and it is being supported – at least by word – by Russia, not a member of the cartel but the world’s biggest oil producer.

However, OPEC’s No.2 producer, Iraq, has said it would not cut output, arguing it needs the revenue to fight Islamic State, and the government is trying to lure investors to boost output further from its current record 4.43 million barrels per day.

(Reporting by Henning Gloystein; Editing by Richard Pullin and Gopakumar Warrier)

US oil settles 2.48 pct lower, or $1.06, at $41.71 a barrel

Gasoline inventories down 2.81M barrels

Gasoline inventories down 2.81M barrels  

Oil prices fell Wednesday after an unseasonal growth in crude stockpiles offset the second-biggest weekly draw in U.S. gasoline this summer.

Data showing Saudi Arabia pumping oil at record high volumes in July added to worries about a global crude glut.

U.S. crude inventories gained 1.1 million barrels in the week ended Aug. 5, the U.S. Energy Information Administration (EIA) reported, in a third straight week of builds that surprised the market. Analysts polled by Reuters had expected a 1.0 million-barrel crude draw instead.

The EIA also reported that U.S. gasoline stocks fell 2.8 million barrels last week in the second-biggest weekly draw for gasoline since mid-April. The draw, coming despite U.S. East Coast refinery runs hitting 2011 lows, exceeded expectations for a gasoline stockpile drop of only 1.1 million barrels.

International benchmark Brent crude futures were down $1.06, or 2.3 percent, at $43.93 per barrel. U.S. West Texas Intermediate (WTI) crude oil futures settled at $41.71 a barrel, down 2.48 percent, or $1.06.

Oil Rig, Operator

Andrey Rudakov | Bloomberg | Getty Images

“We do feel that any further strength in the spot price will be met with selling,” said Tariq Zahir, trader in crude oil spreads at Tyche Capital Advisors in New York. “At this time of year, we should be drawing down in crude inventories, and we are still building.”

U.S. gasoline futures fell 3 percent, after initially gaining 1 percent on the gasoline draw data.

WTI had its sharpest monthly fall in a year in July, dropping 14 percent, after runaway gasoline demand for the summer still fell short of refiner production. Storage tanks worldwide are nearly full with oil products while refiner profits in Singapore have hit two-year lows.

The EIA added to the bearish supply-demand picture on Tuesday with a forecast that showed it had scaled back estimates for U.S. crude oil output declines in 2016.

The outlook for oil also took a hit on Wednesday after No. 1 crude exporter Saudi Arabia told the Organization of the Petroleum Exporting Countries (OPEC) that the kingdom’s output reached a record high of 10.67 million barrels-per-day (bpd) in July.

Some remained positive on oil prices though, citing Venezuela’s renewed efforts to get OPEC to cooperate with other oil producers on the market after a failed effort in April.

“The mere suggestion of OPEC working in the background on a price support initiative should be enough to hold the market in the $43-$45 levels in the near term,” said Salvatore Recco, who helps oversee about $2 billion of client money, including in oil, at Gravity Investments in Denver.

RBC tells investors to watch out for 'bear traps' in oil market

RBC tells investors to watch out for ‘bear traps’ in oilmarket  

When producers last held such talks in April, OPEC members failed to agree on any measures.

“Renewed attempts at verbal intervention by OPEC will help bolster oil market sentiment, although the group will struggle to rebuild its role as a backstop to Brent,” oil analysts at BMI Research said in a note to clients.

The U.S. Energy Information Administration added to the market’s unease earlier on Tuesday when it forecast a smaller decline in U.S. crude oil production in 2016 than it projected a month ago as drilling activity picks up.

The agency now expects U.S. oil output to fall by 700,000 barrels per day (bpd) this year to 8.73 million bpd, compared with the 820,000-bpd drop it previously forecast.

A global products glut that has led storage tanks from Houston to Singapore to reach near capacity is also weighing on oil prices, as analysts warn that only large-scale refinery run cuts can clear the excess.

In Singapore, oil refining profits dropped to two-year lows on Wednesday, in the latest sign that the industry is pumping too much fuel for the market to absorb.