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Oil eases on profit taking, demand jitters; stays near highest in years

CommoditiesOct 13, 2021 03:39PM ET
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© Reuters. FILE PHOTO: A petrol station attendant prepares to refuel a car in Rome, Italy, January 4, 2012. REUTERS/Max Rossi

By Scott DiSavino

NEW YORK (Reuters) -Oil prices eased on Wednesday on worries that crude demand growth would slow, which ate into recent gains that had brought prices to multi-year highs in recent sessions.

Analysts noted that some traders likely took profits in U.S. crude after West Texas Intermediate (WTI) futures hit their highest since October 2014 during the past three sessions.

Brent futures fell 24 cents, or 0.3%, to settle at $83.18 a barrel, while U.S. West Texas Intermediate (WTI) crude fell 20 cents, or 0.3%, to $80.44.

Prices came under pressure early when China, the world's biggest crude importer, released data showing September imports fell 15% from a year earlier.

The market is awaiting U.S. oil inventory data that analysts expect will show a 0.7 million barrel build in crude stocks. [EIA/S] [API/S]

Data from the American Petroleum Institute, an industry group, is due at 4:30 p.m. EDT (2030 GMT) on Wednesday and from the U.S. Energy Information Administration on Thursday. The data was delayed by a day following the Columbus Day holiday on Monday.

Shortages of coal and natural gas in China, Europe and India have boosted prices for the fuels burned for electricity generation. Oil products are being used as a substitute.

The European Commission outlined measures the European Union could use to combat surging energy prices, and said it would explore joint gas purchasing among countries.

The Organization of the Petroleum Exporting Countries (OPEC) trimmed its world oil demand growth forecast for 2021 while maintaining its 2022 view.

But OPEC said surging natural gas prices could boost demand for oil products as end users switch.

"Today’s monthly OPEC report appeared to offer something for both the bulls and the bears with the agency unexpectedly reducing their global oil demand forecast...for this year while adjusting their non-OPEC supply growth estimate downward," said Jim Ritterbusch, president of Ritterbusch and Associates in Galena, Illinois.

Global markets should not expect more oil from Iran in the near future. The United States said it was ready to consider "all options" if Iran is unwilling to return to the 2015 nuclear deal.

In Russia, President Vladimir Putin said oil prices could reach $100 a barrel and noted Moscow was ready to provide more natural gas to Europe if requested.

Energy markets are focused on how the supply crunch will affect oil demand, especially in the world's second biggest economy China.

"These are troubling times for China. A severe energy crisis is gripping the country," said Stephen Brennock of broker PVM.

In India, which is suffering its worst power shortages since 2016 due to a crippling lack of coal, saw fuel consumption crawl higher in September as economic activity ramped up. India is the world's third-biggest oil importer.

In the United States, the government projected consumers will spend more to heat their homes this winter than last year due mostly to surging energy prices.

The White House has been speaking with U.S. oil and gas producers about helping to bring down rising fuel costs.

U.S. gasoline and diesel futures closed at their highest since October 2014 on Wednesday.

Oil eases on profit taking, demand jitters; stays near highest in years
 

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Comments (6)
Kochar Bipin
Kochar Bipin Oct 13, 2021 11:07AM ET
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Very strange reasoning - China continues to keep it's economy running in top gear in spite of flooding in a key coal mining province, China is mining a record 11.2 m tons of coal daily - and it's coal imports are up 76% to 32.8 m tons in Sep. Exports are up 28% in September. Commodity prices - zinc, aluminum, iron ore all have moved up sharply as China today is the largest consumer of these. Of course, this has pushed coal prices to a level where India has cut sharply back on coal imports
Ok Crude
Ok Crude Oct 13, 2021 6:09AM ET
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cry babies,the world has had cheapenergy for 7 years and when it goes as mu h as it went down in 2014you scream because you can't afford to trade oil.you should be little mom and pop oil companies that have suffered for last 7 years.we eat and breathe oil. We come home 7 days a week with oil all over us.fill those tanks and be thankful there are workers like us out here. trying to survive
Optimum integrated Services
Optimum integrated Services Oct 13, 2021 6:09AM ET
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what are trying to say, are happy that everything is on a high side, don't you know oil is the major factor of this inflation, Biden is just a stupid man that is been controlled by arabic people
Kyle Duke
Kyle Duke Oct 13, 2021 1:58AM ET
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There is no growth gor 2 years. ******is this pump
Grant McBride
Grant McBride Oct 13, 2021 1:53AM ET
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Falls 11 cents? Really? What a joke of an article.
Richard Yap
Richard Yap Oct 13, 2021 1:12AM ET
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it is really scary reading these news!!!!! inflationary fears are all over and yet conveniently tucked under the rug! energy demand don't change instantly by the hours! it's all speculation power.
ron king
ron king Oct 13, 2021 12:03AM ET
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i am sorry fear maker! oil does not fall because of that!! quit with the fud
Shawn Pewitt
Shawn Pewitt Oct 13, 2021 12:03AM ET
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Is there a custimer Sevice E-mail?
 
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