Oil prices rally before Algiers talks
Oil prices rally before Algiers talks
Against a backdrop of depressed prices despite Monday’s rally, members of the Organization of the Petroleum Exporting Countries are meeting this week with key non-OPEC producer Russia on the sidelines of the International Energy Forum in Algiers.
Pre-forum talks last week between Saudi Arabia and Iran resulted in neither willing to commit to trimming overproduction, sending prices plunging more than 3.0 percent on Friday.
Around 1615 GMT on Monday, Brent North Sea crude for delivery in November was up $1.47 at $47.36 a barrel.
US benchmark West Texas Intermediate for November rallied $1.37 to $45.85 compared with Friday’s close.
Oil prices have been hammered by a lingering supply glut since late 2014, sending them to near 13-year lows below $30 in January.
While the market has recovered, crude futures are still weak, the head of Gulf giant Saudi Aramco said on Monday, warning that market volatility could persist in the near future.
“While the oil market has recovered from its most severe period, it’s still weak,” Saudi Aramco CEO Amin Nasser said at an energy conference in Dubai.
Algeria’s energy minister on Sunday said “the best solution” in Algiers would be for an agreement on maintaining current output levels.
Oil prices edge up, but set for weekly loss on inventory build, US-China trade row
- US crude stocks last week climbed 6.5 million barrels, the fourth straight weekly build, almost triple the amount analysts had forecast
- An unprecedented volume of Iranian crude oil is set to arrive at China’s northeast Dalian port this month
SINGAPORE: Oil prices nudged higher on Friday on signs of surging demand in China, the world’s second-biggest oil user, though prices are set to fall for a second week amid concerns of the ongoing Sino-US trade war is limiting overall economic activity.
Brent crude oil futures were trading at $79.51 per barrel at 0521 GMT, up 22 cents, or 0.3 percent, from their last close.
US West Texas Intermediate (WTI) crude futures were up 19 cents, or 0.3 percent, at $68.84 a barrel.
For the week, Brent crude was 1.1 percent lower while WTI futures were down 3.5 percent, putting both on track for a second consecutive weekly decline.
Refinery throughput in China, the world’s second-largest oil importer, rose to a record high of 12.49 million barrels per day (bpd) in September as some independent plants restarted operations after prolonged shutdowns over summer to shore up inventories, government data showed on Friday.
The refinery consumption may rise through the fourth quarter as several state-owned Chinese refiners return to service after maintenance.
Undermining the strong refinery data, China did on Friday report its weakest economic growth since 2009 in the third quarter, with gross domestic product expanding by only 6.5 percent, missing estimates.
The weak economic data raised concerns that the country’s trade war with United States is beginning to have an impact on growth, which may limit China’s oil demand.
The trade war concerns combined with surging US oil stockpiles reported on Thursday are capping the day’s price gains.
US crude stocks last week climbed 6.5 million barrels, the fourth straight weekly build, almost triple the amount analysts had forecast, the US Energy Information Administration said on Wednesday.
“EIA Weekly Petroleum Status Report was a complete shocker sending Oil markets spiraling lower amidst some concerning development for oil bulls,” said Stephen Innes, head of trading APAC at OANDA in Singapore.
Inventories rose sharply even as US crude production slipped 300,000 barrels per day (bpd) to 10.9 million bpd last week due to the effects of offshore facilities closing temporarily for Hurricane Michael.
Meanwhile, Iranian oil exports may have increased in October when compared to the previous month as buyers rush to lift more cargoes ahead of looming US sanctions that kick in on Nov. 4.
An unprecedented volume of Iranian crude oil is set to arrive at China’s northeast Dalian port this month and in early November before US sanctions on Iran take effect, according to an Iranian shipping source and data on Refinitiv Eikon.
So far, a total of 22 million barrels of Iranian crude oil loaded on supertankers owned by the National Iranian Tanker Co. are expected to arrive at Dalian in October and November, the data showed. Dalian typically receives between 1 million and 3 million barrels of Iranian oil each month, according to data that dates back to January 2015.