Showing posts with label Oil price. Show all posts
Showing posts with label Oil price. Show all posts

Saturday, August 22, 2015

Oil Prices Fall Again as U.S., Asia Demand Looks Set to Weaken


Oil Prices Dropped in Asian Trading

Oil prices dropped again in early Asian trading recently as traders speculated lowering refinery consumption after the US summer while the weakening economies of Asia and the high global production showed concern on the oversupply. The US crude futures had been trading at $41.84 a barrel each at 0014 GMT, which was around 3 cents below their last settlement and not more than six years low touched earlier this week.

Brent futures had been at $48.61 per barrel, down by 13 cents though the same is still some way from their 2015 low of $45.19. Both crude oil benchmarks have more than halved in value from the last year. They had rallied earlier in the year though are now almost a third below their last year rise in May.

Data have conveyed that several speculators have taken on large bets on further likely falls lying ahead. The reason for the change being twofold, one is the weak demand in several countries due to dull economic growth together with surging US production. Beside this is the fact that the oil association OPEC is unwavering in not cutting production as a way to prop up the prices.

Speculating Rise in U.S, Stockpile

According to ANZ bank it was commented that the `fundamentals suggest downside risk still tends to remain in key markets, especially iron ore and crude oil, in the months ahead’, speculating a rise in U.S. stockpile in the forthcoming months as refiners reduce operations for the purpose of maintenance as the summer driving season tends to come to an end thereby reducing the demand for US crude.

A subsidiary of Fitch Ratings, BMI Research had stated that the market could have an overshot to the downside, hoping in a modest recovery in the prices towards the fourth quarter. BMI Research analyst had commented that `the downward move had been largely speculative driven by the Iranian nuclear accord, economic uncertainties surrounding China and bearish re positioning in the futures market’.

Several oil traders have been positioning themselves to earn profit from an additional drop in U.S. prices. With regards to betting on further outright falls, the traders have become aggressive in taking up put options, an option which tends to sell a contract once the price begins to fall to a certain level, at a price as low as $35 and probably $30 a barrel.

Long-Term Outlook Seems to Remain Bearish

One broker had informed that the amount of queries that they had recently received with regards to leveraging bets on further price falls, have been quite surprising. Underlining the bearish sentiment, money managers as well as hedge funds cut their net long holdings of Brent crude futures for a fourth straight week, according to exchange data shown recently.

Long-term outlook also seemed to remain bearish with BMI Research guessing `oil prices probably to remain fixed till 2018’. They had stated that `the return of Iranian oil to the market, coupled with strong project pipelines in North America, the Middle East, West Africa and Kazakhstan would see global supply growth exceed the growth in global consumption for the next two years’. It was forecasted by the firm, that Brent would average to $56 and $55 in 2016 and 2017 respectively with U.S. crude averaging $53 in both the years.

Sunday, February 24, 2013

Oil Stocks Declining Globally Except US

According to the U.S. Agency for Energy Information (EIA), global oil inventories fell by 1.3 million barrels per day in last 60 days. A situation largely due to consumption exceeds production. On average over the last two months, stocks have been valued at 2.652 billion barrels; while the figure of 2.649 billion was recorded in the same period of 2012.World production meanwhile was 83.3 million barrels per day in January and February, against 83.4 million in the comparable months of 2012. At the same time, consumption has reached 86 million bpd, against an average of 85.3 million in January-February 2012.

 Information on global stocks comes as the abundant supply overseas increasingly worried investors. Fears, which increased Wednesday following the release of statistics showing an increase in the trend. According to the weekly report from the U.S. Department of Energy on oil reserves, U.S. crude oil inventories rose 1.1 million barrels in the week ended Feb. 22. Experts noting they are now at their highest since July to 377.5 million barrels. Situation was due to both less energy consumption than a sluggish increase in crude oil production of 14.6% in 2012 compared to the previous year in 2012, something that had not been observed since 1995. A context that could worsen in the absence of agreement on the U.S. budget obtained - in extremis - Congress on Friday. Such an outcome automatically opening the way for drastic cuts could lead the United States into recession. Means lower demand for crude.

Monday, October 17, 2011

Oil prices boosted by hopes for the G20 summit

Oil prices never ceases to oscillate at the mercy of wind, carried by the waves that hit pessimistic or optimistic current market ... unless these are not swing the tree hiding the forest of speculation ....  The price per barrel has closed up Friday in New York, spruced this time by the optimism associated with expectations of investors about the positive outcome of the meeting of G20 finance ministers held Friday and Saturday. They hope such a recapitalization of the European banking sector to take place.
Caution is however set as the market speculates on a possible continuation of U.S. demand, while consumer confidence is reduced day by day. The index of consumer confidence, released Friday, has in fact eroded again after showing a slight improvement in September. It now approaches its value in August, when he had touched its highest level since November 2008. Worrying figures that even the strong growth in retail sales in September in the United States could not control.  Yet, according to the Commerce Department, the increase was significant and that the increase was 1.1% compared to last month, well above the value of analysts' projections.
Finally, Friday, a barrel of light sweet crude for November delivery gained 2.57 dollars from Thursday's close, trading at 86.80 dollars on the New York Mercantile Exchange (Nymex).

Saturday, September 10, 2011

Oil prices on the increase

Oil-barrel prices rose sharply Wednesday in New York, boosted by the weather and a report from the Fed to say the least optimistic about U.S. growth. The recovery of strength in the stock markets will do the rest. On the New York Mercantile Exchange, a barrel of light sweet crude for October delivery had soared to well over 3.32 dollars Tuesday, up to now the value of 89.34 dollars. Meanwhile in London, the price of Brent North Sea for the same period was trading at 115.80 dollars on the Intercontinental Exchange, rising 2.91 dollars so.

The price of crude rose sharply at the opening as markets react strongly to climatic conditions observed in the Gulf of Mexico, a region where most of the platforms provide a quarter of the oil consumed in the country. Investors have largely responded to the report published by the Office of Management and regulation of ocean energy resources (, the latter indicating that, indeed, if Tropical Storm Lee, who reached Sunday Louisiana had inflicted no major damage, the fact remained that 37% of oil extraction and 18% of gas extraction in the area remained suspended Wednesday.

Although significantly a lower percentages of the values observed the previous day but at a level totally unexpected. Note also a possible disruption of production in Mexico, second largest exporter of crude to the United States while the National Hurricane Center reports that a tropical cyclone could pass within 48 hours, with a probability of 70%.

The price per barrel will also be benefited with the surge in global stock markets observed Wednesday, London and Paris rising more than 3%, while Frankfurt soared more than 4%. Another positive: the report of conditions contained in the Beige Book Federal Reserve (Fed), economic activity in the United States continued to grow at a moderate pace. An ad that has the merit of ending the cycle of bad news experienced in recent times.

Sunday, September 4, 2011

Oil prices weighed down by Employment in US

The price of oil fell sharply Friday in New York, weighed down by strong employment figures sobering.
Stopping a part of the oil production in the Gulf of Mexico will not even possible to change that. A barrel of light sweet crude for October delivery has thus concluded the day at 86.45 dollars on the New York Mercantile Exchange (Nymex), down 2.48 dollars compared to the previous day. The course was even on the verge of reaching the threshold of 85 dollars, then limit its losses by closing.

You will note in passing that the current price fluctuations are far to affect the price of gasoline. Meanwhile in London, the Intercontinental Exchange, a barrel of Brent North Sea crude for October delivery closed at 112.33 dollars, dropping 1.96 dollars.

The courses were largely impacted by the monthly report on employment. However, while a positive balance of recruitment had been found for ten consecutive months and in contrast to analysts' projections, the American economy has not created any jobs in August. However, some analysts had estimated in early trading as climatic conditions in the Gulf of Mexico could reverse the trend, Tropical Storm Lee threatened oil installations producing a quarter of U.S. crude.

However, while almost 48% of oil production in the area was arrested, corresponding to 666,321 barrels per day, and 33% of offshore gas extraction, prices could rise. Another disturbing fact: according to forecasts from Barclays Capital, gasoline consumption in the United States fell by 4.1% in annual slippery during the summer period, however, conducive to the mobility of Americans.

Thursday, September 1, 2011

Oil Prices On Rise

Oil prices rose sharply Monday in New York, boosted by buoyant equity markets. Wall Street has indeed been boosted during the day by publishing an indicator of consumption in the United States that the current level was satisfactory. On the New York Mercantile Exchange (Nymex), a barrel of "light sweet crude" for delivery in October had concluded the day at 87.27 dollars, up 1.90 dollars from Friday.

Markets remain driven by the president's speech to the U.S. central bank (Fed), Ben Bernanke delivered Friday that may foreshadow the development of new stimulus measures in the monetary policy meeting in September in which the duration was extended. The glow of optimism in the markets is observed following the announcement of a stronger than expected rebound in consumer spending of households, which rose 0.8% in July.

Also note that at present, the impact of Hurricane Irene in oil markets remains weak, no crude oil production being listed in the affected areas and no major disruption in supplies being to report.