Breaking News
0

Oil dips amid record US exports, but trade optimism supports

CommoditiesFeb 25, 2019 02:15AM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
© Reuters. Pumpjacks are seen against the setting sun at the Daqing oil field in Heilongjiang

By Henning Gloystein

SINGAPORE (Reuters) - Oil prices dipped on Monday, dragged down by plentiful supply as U.S. exports soar and compete with traditional producers from the Middle East in key markets such as Asia.

But markets were supported by optimism that Washington and Beijing would soon resolve a series of trade disputes that have dented global economic growth, analysts said.

International Brent crude oil futures were at $67 a barrel at 0712 GMT, down 12 cents, or 0.2 percent, from their last close. They ended Friday little changed after touching their highest since Nov. 16 at $67.73 a barrel.

U.S. West Texas Intermediate (WTI) crude futures were at $57.20 per barrel, down 6 cents, or 0.1 percent, from their last settlement. WTI futures climbed 0.5 percent on Friday, having marked their highest since Nov. 16 at $57.81 a barrel.

Traders said the dips were the result of ample oil supply amid surging exports from the United States, forcing other producers especially in the Middle East to start offering their crude at discounts.

Under pressure from that growth in U.S. supply, Abu Dhabi's flagship Murban crude has sold at a discount in Asia to its official selling price (OSP) for four straight months - the longest stretch in nearly two years.

Cargoes bought for loading in the first four months of 2019 were sold at discounts ranging from 5 cents to 40 cents a barrel, even as producer Abu Dhabi National Oil Company (ADNOC) cut the grade's benchmark price for four consecutive months.

U.S. crude oil production has hit a record 12 million barrels per day (bpd), an increase of more than 2 million bpd since early 2018. Exports hit a record 3.6 million bpd this month.

The surge in U.S. oil output counters efforts led by the Middle East-dominated Organization of the Petroleum Exporting Countries (OPEC) to cut output to tighten the market and prop up prices.

The OPEC-led cuts as well as U.S. sanctions against Iran's and Venezuela's oil exports pushed oil prices to 2019 highs last week.

While ample supply weighed on prices, trade optimism supported financial markets, including crude futures.

President Donald Trump said on Sunday he would delay an increase in U.S. tariffs on Chinese goods thanks to "productive" trade talks and that he and Chinese President Xi Jinping would meet to seal a deal if progress continued.

"The suggestion from President Trump that he is planning for a summit for President Xi and himself will also raise investor excitement that a resolution to this long-standing trade conflict is nearing a conclusion," said Jameel Ahmad, head of market research at futures brokerage FXTM.

Oil dips amid record US exports, but trade optimism supports
 

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind: 

  • Enrich the conversation
  • Stay focused and on track. Only post material that’s relevant to the topic being discussed.
  • Be respectful. Even negative opinions can be framed positively and diplomatically.
  •  Use standard writing style. Include punctuation and upper and lower cases.
  • NOTE: Spam and/or promotional messages and links within a comment will be removed
  • Avoid profanity, slander or personal attacks directed at an author or another user.
  • Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
or
Sign up with Email