United States crude oil inventories decrease last week: API

United States crude oil inventories decrease last week: API

Crude exports from Saudi Arabia fell by a half-million barrels a day in December, led by lower flows to the US and China, according to tanker tracking data compiled by Bloomberg, and the United Arab Emirates showed a decline as well. A similar Reuters survey said the cartel's November output had the biggest fall since January 2017.

The output fall came ahead of the reduction of 1.2 million barrels a day from October 2018 levels pledged by OPEC and nonmember producers, including Russian Federation, that became effective at the start of the new year.

U.S. West Texas Intermediate crude rose $2.22, or 4.9 per cent, to $47.63.

Brent crude oil ended the year at 54 US dollars per barrel, 13 dollars per barrel lower than it began the year.

The global benchmark is on track for a 9.7 percent advance this week, ending three consecutive weeks of losses.

“Oil is due for a bounce as futures are oversold but without a notable catalyst, and a rebound in stocks, it will be hard for WTI to rally beyond resistance in the low $50s, ” said Richey.

South Africa vs Pakistan
He rode his luck before being forced into a surprising dismount when he nicked a peach of a delivery from Shaheen Afridi. Du Plessis made 103, his ninth Test century, as South Africa reached 382 for six at the close, a lead of 205 runs.

"During that interim period you are going to have all sorts of variables, like the trade war, like slower economic growth, like the White House and whether President Trump is going to tweet for lower oil prices every 24 hours." says Wallace. On Wednesday, WTI and Brent crude climbed by more than 2% after a reported drop in December crude exports emerged from Saudi Arabia.

"Oil prices ... registered their first yearly decline in three years on fears of a slowing global economy and concerns of an ongoing supply glut", said Adeel Minhas, a consultant at Australia's Rivkin Securities.

That is also impacting sentiment in oil markets.

Saudi Arabia raised pricing for most crude grades to Asia and for all blends to buyers in the USA for delivery in February as the world's biggest exporter cuts output to clear a global oil glut.

In addition "U.S. shale is likely to disrupt any steep price momentum during the first quarter of 2018, as USA gulf refineries are looking inwards to procure light crude", de Silva said. Other data showed US output reached a record in October and Iraq boosted oil exports in December.

Important trends to watch over coming months is whether muted global output growth is reducing fuel consumption; will U.S. shale production maintain its incredible pace; will chronic decline in Venezuelan output continue; what will full-brown United States sanctions do to Iranian exports; and if OPEC+ partners (notably Russia) can satisfactorily enforce output discipline? It trades 11% lower week to date. The Saudis have used this price-boosting strategy in the past to shrink USA stockpiles. Both are delayed this week because of Tuesday's New Year's Day holiday. There were also doubts as to whether the group will be able to enforce the agreement. US commercial crude stocks rose to 441 million barrels in the week ended December 21, up from 394 million barrels in mid-September, according to the US Energy Information Administration.

Related Articles