En Español



Very usefull links



PW
Bookstore





News links

AP

AFP

Aljazeera

Dow Jones

Oil price

Reuters

Bloomberg

Views and News
from
Norway

 

 

 

 

Oil markets cautious Monday on Middle East tensions, increased U.S. drilling

By Henning Gloystein

SINGAPORE
Petroleumworld 11 13 2
017

Oil trading was cautious on Monday amid ongoing tensions in the Middle East and after a rising rig count in the United States suggested producers there are preparing to increase output.

Brent crude futures LCOc1 were at $63.55 per barrel at 0614 GMT, up 3 cents from their last close. U.S. West Texas Intermediate (WTI) crude CLc1 was at $56.79 per barrel, up 5 cents.

Traders said crude prices were generally well supported as ongoing output cuts led by the Organization of the Petroleum Exporting Countries (OPEC) and Russia have contributed to a significant reduction in excess supplies that have been dogging markets since 2014.

“The excess of OECD oil inventories over their five-year average levels has fallen by more than 50 percent in 2017, with inventories currently at around 160 million barrels. If current trends continue, inventories are likely to return to the five-year average at some stage in 2018,” consultancy Timera Energy said on Monday, adding that strong demand had also helped reduce the glut.

On the supply side, tensions in the Middle East raised the prospects of disruptions, traders said.

Bahrain said over the weekend that an explosion which caused a fire at its main oil pipeline on Friday was caused by sabotage, linking the attack to Iran, which denied any role in the incident.

Despite the Middle East tensions and OPEC-led supply cuts, traders were cautious in betting on further price rises, not least because of an increase in U.S. drilling for new production.

U.S. drillers added nine oil rigs in the week to Nov. 10, the biggest jump since June, bringing the total count up to 738, Baker Hughes energy services firm said on Friday.

The rig count RIG-OL-USA-BHI is also much higher than a year ago when only 452 rigs were active, indicating that the U.S. oil industry is comfortable operating at current prices.

U.S. oil producers have raised output C-OUT-T-EIA by more than 14 percent since mid-2016 to a record 9.62 million barrels per day.

This led to a slide in crude futures prices late on Friday away from over two-year highs reached early last week.

Some analysts warned that both WTI and Brent crude futures looked overbought following strong price rises in late October and early November, raising the risks of a downward correction.

“From a technical perspective, both contracts' Relative Strength Indexes (RSI) are still in severely overbought territory, signalling that a potentially aggressive short-term downward correction is still a genuine possibility,” said Jeffrey Halley, senior market analyst at futures brokerage OANDA in Singapore.

Brent hit its highest level since 2015 in November, pushing the RSI above 70 points, which implies an overbought market.


Story by Henning Gloystein; Editing by Joseph Radford and Kenneth Maxwell from Reuters.

reuters.com 11 13 2017 02:26GMT

We invite all our readers to share with us
their views and comments about this article.
Write to editor@petroleumworld.com

By using this link, you agree to allow PW
to publish your comments on our letters page.

Any question or suggestions,
please write to: editor@petroleumworld.com

Best Viewed with IE 5.01+ Windows NT 4.0, '95,
'98,ME,XP, Vista, Windows 7,8,10 +/ 800x600 pixels


Nov 13-14 ;
Mexico City, Mexico

 

 

 

TOP

Contact: editor@petroleumworld.com,

Editor & Publisher:Elio Ohep/
Contact Email: editor@petroleumworld.com

CopyRight © 1999-2016, Paul Ohep F. - All Rights Reserved. Legal Information

PW in Top 100 Energy Sites

CopyRight©1999-2017, Petroleumworld ™  / Elio Ohep - All rights reservedThis site is a public free site and it contains copyrighted material the use of which has not always been specifically authorized by the copyright owner.We are making such material available in our efforts to advance understanding of business, environmental, political, human rights, economic, democracy, scientific, and social justice issues, etc. We believe this constitutes a 'fair use' of any such copyrighted material as provided for in section 107 of the US Copyright Law. In accordance with Title 17 U.S.C. Section 107, the material on this site is distributed without profit to those who have chosen to view the included information for research, information, and educational purposes. For more information go to: http://www.law.cornell.edu/uscode/17/107.shtml. If you wish to use copyrighted material from this site for purposes of your own that go beyond 'fair use', you must obtain permission fromPetroleumworld or the copyright owner of the material.