& Tobago

Very usefull links




News links




Dow Jones

Oil price



Views and News





Oil suffers biggest monthly loss Wednesday in more than 2 years

By Mayra P. Saefong

Petroleumworld 10 30 2018

Oil futures settled lower Wednesday as a weekly rise in U.S. crude supplies nearly matched market expectations and product stocks declined.

Prices also posted their biggest monthly percentage decline in more than two years as rising production and the potential for a slowdown in energy demand outweighed expectations for further declines in Iranian oil exports, with U.S. sanctions set to begin next week.

West Texas Intermediate crude for December delivery CLZ8, -0.52%  fell 87 cents, or 1.3%, to settle at $65.31 a barrel on the New York Mercantile Exchange. Based on the front-month contracts, prices lost 10.8%, according to Dow Jones Market Data.

Global benchmark December Brent crude LCOZ8, -0.59% which expired at the settlement, fell 44 cents, or 0.6%, to $75.47 a barrel on the ICE Futures Europe exchange. Front-month contract prices declined by about 8.8% for the month of October.

Both Brent and WTI, which saw another settlement at their lowest in more than two months, suffered from their largest monthly percentage decline since July 2016.

The Energy Information Administration reported Wednesday that domestic crude supplies rose by 3.2 million barrels for the week ended Oct. 26. That followed five consecutive weeks of gains. Analysts surveyed by S&P Global Platts had forecast a rise of 3.3 million barrels, while the American Petroleum Institute on Tuesday reported an increase of 5.7 million barrels.

“Although [crude] refinery runs are clambering higher, away from the depths of maintenance season, there has still been a sixth consecutive build to oil inventories,” said Matt Smith, director of commodity research at ClipperData.

“In a similar fashion to last week, bullish draws to the products have acted as a counterweight to bearish sentiment,” he said, adding that half of the reported crude build came from another release from the Strategic Petroleum Reserve.

Gasoline stockpiles declined by 3.2 million barrels last week, while distillate stockpiles fell by 4.1 million barrels, according to the EIA. The S&P Global Platts survey had shown expectations for supply declines of 2.4 million barrels in gasoline and 2.2 million barrels for distillates.

November gasoline settled at $1.768 a gallon, down 2.1% for the session with prices, based on the front-month contract, tallying monthly loss of 15.9%. November heating oil HOX8, -0.38%  tacked on nearly 0.1% to $2.262 a gallon, for a monthly decline of 3.8%. The November contracts expired at the day's settlement.

December natural gas NGZ18, +0.37%  rose 2.3% to $3.261 per million British thermal units, with prices up 8.4% for the month, based on the front month, according to Dow Jones MarketData.

Meanwhile, U.S. sanctions on Iran's oil industry are set to take effect at the start of next week after President Donald Trump in May pulled the U.S. out of a 2015 international agreement to curb Iran's nuclear program, setting the stage for the reimposition of sanctions.

Perhaps, a more important question has been whether other producers will make up the lost supply. Saudi Arabia, the de facto head of the Organization of the Petroleum Exporting Countries, and leading producers outside the cartel, primarily Russia, agreed in early summer to begin ramping up crude production after more than a year of holding back. Comments in recent weeks by the Saudis that they could ramp up output at an event faster rate—reaching at least 11 million barrels a day—have further weighed on prices of late.

“Some market observers thought at the beginning of October that the price would climb to $100, begging the question of what has changed so fundamentally in the past 3-4 weeks,” said Carsten Fritsch and the commodities team at Commerzbank, in a note.

“What has changed above all is market sentiment, partly due to increasing concerns about demand as a result of the trade conflict between the U.S. and China and the latest price slide on the stock markets , though real demand data remained robust in September,” Commerzbank said. “The supply side has likewise played a role, with crude oil stocks in the U.S. having risen significantly for weeks. [while] Saudi Arabia, Russia and Libya scaled up their oil production noticeably in October. As a result, oil producers appear to be successfully offsetting the supply outages from Iran and Venezuela.”


Story by Mayra P. Saefong from MarketWatch.

10 31 2018 19:30 GMT

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

Twitter: @petroleumworld1

November 13 - 15, 2018.

Gubkin University, Moscow
SPE Student Chapter


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.