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Oil settles down but off 2-week low; supply concerns in focus

CommoditiesOct 28, 2021 07:12PM ET
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© Reuters. FILE PHOTO: An oil pump is seen near Bakersfield, California October 14, 2014. REUTERS/Lucy Nicholson

By Jessica Resnick-Ault

NEW YORK (Reuters) -Oil prices dipped on Thursday but settled off two-week lows as concerns about U.S. supply growth vied with speculation that Iran's supply could come online following nuclear talks with global powers.

Brent crude settled down 26 cents, or 0.3%, lower at $84.32 a barrel. During the session it hit a two-week low of $82.32 after falling 2.1% on Wednesday.

U.S. West Texas Intermediate (WTI) crude rose 15 cents, or 0.2%, to settle at $82.81. During the session the contract touched a two-week low of $80.58. On Wednesday, the benchmark dropped 2.4% after weekly data showed U.S. crude stockpiles grew more than expected.

On Wednesday, Iran's top nuclear negotiator Ali Bagheri Kani said the country's talks with six world powers to try to revive a 2015 nuclear deal will resume by the end of November.

A deal could pave the way to lifting harsh sanctions imposed by former U.S. President Donald Trump on Iran's oil exports in late 2018.

"The market reacts to these headlines, but may be disappointed by how much oil actually returns," said Phil Flynn, senior analyst at Price Futures Group in Chicago.

U.S. crude stocks rose by 4.3 million barrels last week, the U.S. Energy Department said on Wednesday, more than double the 1.9 million-barrel gain forecast by analysts. [EIA/S]

The hefty stockbuild was because of a large jump in net imports of crude oil while refinery processing remained sluggish, Citi Research analysts said in a note.

Yet gasoline stocks fell by 2 million barrels to their lowest in nearly four years, even as U.S. consumers contend with rising pump prices. [EIA/S]

At the WTI delivery hub in Cushing, Oklahoma, crude storage was at its lowest levels in three years, with prices for longer-dated futures contracts indicating supplies will remain low for months.

Energy information provider Genscape said that as of Oct. 26, tank levels at Cushing had fallen by 2.772 million in the last week, market participants said.

Outbreaks of coronavirus infections in China and record deaths and the threat of lockdowns in Russia, along with rising cases in western Europe, also weighed on prices.

Oil settles down but off 2-week low; supply concerns in focus
 

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Comments (3)
Neel Shaksham
Neel Shaksham Oct 28, 2021 9:53AM ET
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all fake this is nothing govt. is trapped in it's own trap. wallah habibi. now inflation will go to sky and rich will become richer and poor will be poorer.
Aleksandr Radchenko
Aleksandr Radchenko Oct 28, 2021 4:01AM ET
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"A surge in new cases of COVID-19 threatens to disrupt the recovery in oil demand," ANZ Research commodities strategists Daniel Hynes and Soni Kumari said in a new report on Thursday. ahaha, strategists. I announced this on Tuesday, 2 days earlier than these people. thus you had the opportunity to sell oil at a high price and make good money. you did? well, you still have the option of hiring me as a lead strategist if your company is big and smart enough. ahaha. https://m.investing.com/news/commodities-news/oil-takes-breather-after-latest-charge-amid-tight-market-2654891
Val Lange
Val Lange Oct 28, 2021 1:11AM ET
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Oil prices fell after U.S. crude oil stockpiles rose more than expected, even as fuel inventories dropped and tanks at the nation's largest storage hub emptied further to the level of 5 years ago.
Danny Schwarz
Danny Schwarz Oct 28, 2021 1:11AM ET
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Great point!
 
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