Oil falls to almost 6-month lows after surprise rise in US crude and gasoline prices.

The sticker says crude oil on the side of a storage tank in the Permian Basin in Mentone, Loving County, Texas, U.S. November 22, 2019. REUTERS/Angus Mordant

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  • US Crude, Gasoline Stockpiles Unexpectedly Rise: EIA
  • OPEC + decides a small increase of 100,000 bpd to the production target
  • The US had pushed for a more significant supply increase
  • Iranian and US negotiators travel to Vienna for talks

HOUSTON, Aug 3 (Reuters) – Oil prices fell about 4% on Wednesday to near six-month lows, after U.S. daily (bpd) data.

Brent crude futures settled down $3.76, or 3.7%, at $96.78 a barrel. That was his lowest deal since Feb. 21.

West Texas Intermediate (WTI) crude futures fell $3.76, or 4%, to $90.66, the lowest close since Feb. 10. The contract hit a session low of $90.38 a barrel, its lowest level since February 25.

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Both contracts fluctuated during the session.

The premium in Brent futures for the previous month over cargo barrels six months from now is at a three-month low, signaling waning concern over supply shortages. The same premium for WTI futures approached a four-month low.

US crude oil inventories unexpectedly rose last week as exports fell and refiners curtailed operations, while gasoline stocks also saw an unexpected rise as demand slowed, the Administration said. of Energy Information.

Crude stocks rose 4.5 million barrels last week, compared with an analyst’s forecast for a drop of 600,000 barrels. Gasoline stocks gained 200,000 barrels, versus expectations for a drop of 1.6 million barrels.

“The crude oil number is way above expectations. Gasoline is a disappointment. You should never see gasoline go up over the summer. It’s a very bearish report,” said Bob Yawger, director of energy futures at Mizuho. .

Ministers from the Organization of the Petroleum Exporting Countries (OPEC) and allies, including Russia, known as OPEC+, agreed to the small increase in the group’s output target, equivalent to about 0.1% of global oil demand. read more

While the group has been asked by the United States to increase production, additional capacity is limited and Saudi Arabia may be reluctant to increase production at the expense of Russia, hit by sanctions over the Ukraine conflict.

The Biden administration is focused on keeping oil prices low, the White House said.

Before the meeting, OPEC+ cut its forecast for the oil market surplus this year by 200,000 bpd to 800,000 bpd, three delegates told Reuters. read more

Also weighing on prices, Iranian and US officials said they would travel to Vienna to resume indirect talks on Iran’s nuclear program, reviving all but faded hopes for an removal of sanctions hampering Iranian oil exports. read more

On the demand side, Federal Reserve officials again on Wednesday expressed their determination to rein in high inflation, though one said a half percentage point hike in the key US central bank interest rate on next month could be enough to move towards that goal. read more

The US dollar index, which tracks the greenback against six major pairs, also rose, pressuring demand by making oil more expensive for holders of other currencies.

However, oil prices were helped by the Caspian Pipeline Consortium (CPC), which connects Kazakhstan’s oil fields to Russia’s Black Sea port of Novorossiisk, saying supplies had dropped significantly, without providing figures. read more

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Additional reporting by Laila Kearney and Stephanie Kelly in New York, Shadia Nasralla in London, Sonali Paul and Emily Chow; Edited by Marguerita Choy, David Goodman and David Gregorio

Our standards: the Thomson Reuters Trust Principles.

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