Oil prices decline Thursday on swelling oversupply, volatile markets
Noah Browning / Reuters
Petroleumworld 01 03 2019
Oil prices fell slightly on Thursday amid volatile currency and stock markets, coupled with concerns that an economic slowdown in 2019 will curb fuel demand just as crude supplies are surging.
U.S. West Texas Intermediate crude oil futures CLc1 dropped 35 cents to $46.19 a barrel by 0900 GMT.
International Brent crude futures LCOc1 were down 7 cents at $54.84 a barrel.
Markets were buffeted by a 4.4 percent slump in the U.S. dollar against the Japanese yen JPY=D3 - which is regarded as a safe haven currency - and after tech giant Apple ( AAPL.O ) cut its sales forecast for the first time in nearly 12 years.
“We did not foresee the magnitude of the economic deceleration, particularly in Greater China,” Apple chief executive Tim Cook said.
The slowdown in China and turmoil in stock and currency markets appears to be making investors nervous, including in oil markets.
“This is a continuation of the volatility afflicting commodities and oil with the last 24 hours marked by the release of various weak economic data points, particularly manufacturing PMIs, for major economies,” consultancy JBC Energy said.
In physical oil markets, top exporter Saudi Arabia is expected to cut February prices for heavier crude grades sold to Asia by up to 50 cents a barrel due to weaker fuel oil margins, respondents to a Reuters survey said on Thursday.
“Fears of future economic and earnings growth continue to be the main driver in causing market jitters,” Singapore-based brokerage Phillip Futures said.
Oil markets are also under pressure from a surge in supply just as demand growth is expected to slow.
U.S. crude production stood at a record 11.7 million barrels per day (bpd) in late 2018, making America the world's biggest oil producer.
Speaking to reporters on Wednesday, President Donald Trump said U.S. pressure had kept production high among allies in the Organization of the Petroleum Exporting Countries.
“People see that gasoline is way down and the reason it's way down is because I called up some of the OPEC people,” Trump said. “I made calls, I said you better let that oil, that gasoline flow, and they did,” Trump added.
Others are not sitting idle, with Russian output reaching a record of more than 11 million bpd in 2018.
Supply from Iraq, the second biggest producer in OPEC, is also up, with December exports at 3.73 million bpd versus 3.37 million bpd in November.
We invite you to join us as a sponsor. Circulated Videos, Articles, Opinions and Reports which carry your name and brand are used to target Entrepreneurs through our site, promoting your organization’s services. The opportunity is to insert in our stories pages short attention-grabbing videos, or to publish your own feature stories.
Editing by Dale Hudson/Mark Heinrich from Reuters.
reuters.com 01 03 2018 11:09 GMT
Hit your target - Advertise with us
PW 300.000 plus request per week
Copyright© 1999-2018 Petroleumworld or respective author or news agency. All rights reserved.
We welcome the use of Petroleumworld™ (PW) stories by anyone provided it mentions Petroleumworld.com as the source.
Other stories you have to get authorization by its authors. Internet web links to http://www.petroleumworld.com are appreciated.
Petroleumworld welcomes your feedback and comments, share your thoughts on this article, your feedback is important to us!
We invite all our readers to share with us
their views and comments about this article.
Write to firstname.lastname@example.org
By using this link, you agree to allow PW
to publish your comments on our letters page.
Any question or suggestions,
please write to: email@example.com
Best Viewed with IE 5.01+ Windows NT 4.0, '95,
'98,ME,XP, Vista, Windows 7,8,10 +/ 800x600 pixels