Oil Falls Despite Biggest US Stockpile Drop in Five Weeks
by Bloomberg | Jordan Fitzgerald
click here to read this article at Rigzone.com
*this article was not written by Roseland Oil & Gas
Oil sank despite US data showing the biggest drop in the nation’s stockpiles in five weeks, with traders awaiting Sunday’s OPEC+ meeting for more guidance on supply.
West Texas Intermediate crude slipped 1.7% to settle below $78 a barrel on Thursday. US oil inventories fell by 4.16 million barrels last week — compared with a median estimate of 1.15 million.
Meanwhile, the prompt timespread for Brent crude has weakened into a contango structure for the first time since January, which dragged prices down further as spooked traders fear the market is oversupplied. Brent futures fell 2.1% to settle below $82.
Oil has been searching for direction after facing contradictory pressures this week. Commodities followed stocks lower amid lingering concern that interest rates will stay higher for longer. The bearish sentiment offset worries about an attack on a ship in the Red Sea and an Israeli official’s prediction that the country won’t be able to defeat Hamas before the end of this year.
Oil has risen this year on geopolitical conflicts and production curbs by the Organization of the Petroleum Exporting Countries and its allies. The group will likely consider factors including a drop in prices over the past month, a weaker Chinese demand outlook and healthy supplies from the Americas when ministers convene on Sunday.
The alliance is widely expected to prolong output cuts into the second half of 2024, which Brian Kessens, a managing director at Tortoise Capital Advisors LLC said “will add some certainty to the market.”
Prices:
- WTI for July delivery declined 1.7% to settle at $77.91 a barrel in New York.
- Brent for July settlement dropped 2.1% to $81.86.
by Bloomberg | Jordan Fitzgerald
click here to read this article at Rigzone.com
*this article was not written by Roseland Oil & Gas