Oil prices mixed as producers release more supply in the market

US crude stocks rose by 5.8 million barrels last week, compared with a forecast of a decline of 3.6 million barrels. (Reuters)
Updated 19 July 2018

Oil prices mixed as producers release more supply in the market

  • The US Energy Information Administration also reported US oil production reached a record 11 million barrels per day
  • US crude stocks rose by 5.8 million barrels last week, compared with a forecast of a decline of 3.6 million barrels

TOKYO: Oil prices were mixed on Thursday as the market struggled to digest signs of strong gasoline demand in the US, the world’s biggest consumer of the fuel, with a statement from oil producers that they are putting more crude on the market.
Brent crude futures fell 11 cents, or 0.2 percent, to $72.79 a barrel at 0401 GMT. West Texas Intermediate (WTI) crude futures climbed 6 cents, or 0.1 percent, to $68.82.
Both benchmarks rose by 1 percent on Wednesday after inventory data from the US Energy Information Administration reported on Wednesday US gasoline stockpiles fell along with supplies of distillate fuels. Motor fuel demand also rose from the week before and was up from a year earlier.
However, the EIA also reported US oil production reached a record 11 million barrels per day (bpd). The US has added nearly 1 million bpd in production since November, thanks to rapid increases in shale drilling.
Also, a meeting of members of the Organization of the Petroleum Exporting Countries (OPEC) and non-OPEC producer monitoring their supply pact reported on Wednesday that compliance with the agreement has declined, meaning more oil is available to the market.
The bullish tone sparked by the gasoline data is unlikely to last, said Stephen Innes, head of trading APAC at brokerage OANDA.
“President Trump is doing everything in his power to lower gasoline prices,” he said.
“With Russia quick to offer the President a supply olive branch and Saudi Arabia mainly in his back pocket when it comes to increasing their supply, its challenging to see (the) gasoline numbers turning the bearish market’s tide,” he said.
Gasoline inventories fell by 3.2 million barrels last week, while distillate stockpiles, which include diesel and heating oil, dropped by 371,000 barrels, the EIA said on Wednesday.
A Reuters poll taken before the data release had forecast that gasoline stocks would be unchanged and distillate stockpiles would show a build of around 900,000 barrels.
A sharp jump in crude oil inventories in the US also added to the bearish tone in the market.
US crude stocks rose by 5.8 million barrels last week, compared with a forecast of a decline of 3.6 million barrels.
Oil markets have fallen over the last week as Saudi Arabia and other members OPEC member and Russia have increased production and as some supply disruptions have eased.
OPEC and non-OPEC’s compliance with oil output curbs has declined to around 120 percent in June from 147 percent in May, two sources familiar with the matter told Reuters on Wednesday.


Canada’s Trudeau to unveil plan to address coronavirus outbreak, revive economy

Updated 14 min 13 sec ago

Canada’s Trudeau to unveil plan to address coronavirus outbreak, revive economy

  • Trudeau will stress the need for environmental policies such as retrofitting buildings, boosting the use of electric vehicles and biofuels
  • Trudeau is paring down talk of a green revolution to slash reliance on export of fossil fuels

OTTAWA: Canadian Prime Minister Justin Trudeau will unveil on Wednesday what he says is a far-reaching plan to help the economy recover from the coronavirus pandemic while ensuring efforts to fight the outbreak do not falter.
Trudeau, who has consistently vowed to do more to combat climate change, is paring down talk of a green revolution to slash reliance on export of fossil fuels as Canada faces a resurgence in coronavirus cases.
“The three prongs of what we are doing are fighting COVID-19, supporting Canadians, and a resilient recovery,” said a government source who requested anonymity given the sensitivity of the situation.
The so-called Speech from the Throne outlining government plans is a confidence measure and given that Trudeau’s Liberals only have a minority in the House of Commons, they will need the support of opposition legislators to avoid being toppled and plunging the country into an election.
The left-leaning New Democrats have made clear they are likely to vote in favor. Trudeau’s popularity initially soared over his handling of the pandemic, but polls suggest he and the Liberals were damaged by a scandal over his close ties to a charity chosen to run a student grant program.
Parliament is usually packed for the occasion but COVID-19 means few legislators will be present when Governor General Julie Payette — the representative of Queen Elizabeth, Canada’s head of state — delivers the speech at around 3 p.m. (1900 GMT).
Later on Wednesday, Trudeau plans to make a national address to address the urgency of fighting COVID-19, a spokesman said.
Officials say the throne speech will contain policy proposals such as childcare and an expanded employment insurance program rather than specific spending commitments, some of which will be disclosed in a fiscal update later in the year.
But Trudeau will stress the need for environmental policies such as retrofitting buildings, boosting the use of electric vehicles and biofuels, aides say.