Oil resists above $73

Oil resists above $73


Part of the effects of Hurricane Ida in Louisiana, USA

The performance of oil prices varied on Friday after a strong rise in the previous session due to the weakness of the dollar and the decline in US inventories, and prices are heading towards achieving modest gains with a weak monthly job report in the United States.
Brent crude futures rose 14 cents, or 0.19 percent, to $73.17 a barrel by 14:10 GMT, while US West Texas Intermediate crude futures settled at $69.99 a barrel.

And futures contracts for the benchmark crude oil jumped two percent Thursday, putting the US West Texas Intermediate crude on the path to rise 1.8 percent in the week, while Brent is heading towards achieving a weekly gain of 0.6 percent.

Stephen Innes, managing partner at S. BI Asset Management said the downward movement in WTI is likely due to traders taking out exposure to the market ahead of the US non-farm payrolls report for August, on concerns that the report was weaker than average expectations. But some analysts see scope for the oil price to achieve further gains in light of tight crude supplies and indications of a recovery in fuel demand.

“With the oil market still posting a solid deficit for the rest of the year, it looks like oil is poised for a further rally as OPEC+ sends signals of discipline in reducing cuts and US inventories continue to fall,” said Edward Moya, senior market analyst at OANDA.
The price increase this week also comes in light of the decline in the US dollar, which reduces the cost of oil to holders of other currencies, and with the repercussions of Hurricane Ida.

Production of about 1.7 million barrels per day of oil is still suspended in the US Gulf of Mexico, as damage to helicopter landing and take-off areas and fuel depots slows the return of crews to offshore platforms, sources told Reuters. Oil is on hold as continuing power outages slow the reopening of shuttered refineries in Louisiana.

“OPEC Plus” expects the surplus to return to the oil market in 2022

Oil markets under pressure from IDA and Chinese data

The technical committee of “OPEC +” expects global demand for oil to grow by 5.95 million barrels per day this year

The joint technical committee of “OPEC Plus” expected that the oil market will remain in a deficit of 0.9 million barrels per day this year, but it will record a surplus of 2.5 million barrels per day in 2022 as the group increases production.

The committee expects that global demand for oil will grow by 5.95 million barrels per day this year, in line with its previous forecast, and 3.28 million barrels per day next year.

The “OPEC Plus” group, which includes member states of the Organization of the Petroleum Exporting Countries (OPEC) and its allies led by Russia, will meet today (Wednesday), at 15:00 GMT to determine policy.

Wednesday's meeting will likely keep the plan unchanged despite pressure from the United States to pump more oil.
The Joint Technical Committee, which advises the meeting on market fundamentals, expects commercial oil stocks in OECD countries to remain below their 2015-2019 average through January next year, but will exceed that average for the rest of 2022, according to the report. document revealed.

Oil prices fell during trading yesterday (Tuesday), in light of fears that power cuts and floods in the US state of Louisiana due to Hurricane Ida will reduce demand for crude from refineries, while global producers intend to increase production.

Prices were also pressured by weaker manufacturing data from China, where factory activity expanded at a slower pace in August compared to the previous month.
US West Texas Intermediate crude futures fell 0.3%, to $68.94 a barrel by 15:48 GMT, giving up some of the gains made the day before yesterday (Monday).

As for the futures contracts for Brent crude for October delivery, which are scheduled to expire yesterday, they also fell 0.2%, to $72.06 a barrel, after increasing on Monday about 1%. The most active November contracts fell 3 cents, or 0.4%, to $72.20.

"The oil market is in a wait-and-see mode, as the impact of Hurricane Ida is being assessed on both demand and supply. Also, market players are reluctant," said Ravindra Rao, vice president of commodities at Kotak Securities. About making big bets before the “OPEC Plus” review meeting” today.

Hurricane Ida halted at least 94 percent of offshore oil and gas production in the Gulf of Mexico and caused "catastrophic" damage to Louisiana's power grid.

Utility officials say the power outages could last up to three weeks, slowing efforts to repair and restart power facilities, which could take at least two weeks to fully resume operations.

Also curbing prices is the possibility that the Organization of the Petroleum Exporting Countries (OPEC) and allies of the group known as "OPEC Plus" will agree to press ahead with plans to add an additional 400,000 barrels per day to supplies each month from December.
Previous Post Next Post