News of Russia’s unprecedented monthly oil output comes one week before the country will meet with the OPEC producers’ group in Algeria to discuss the global glut.
Advertisement
A big drop in U.S. crude stockpiles sent oil prices sharply higher on Wednesday (Sep 21).
“The price surge was sparked by news from Libya”, analysts at Commerzbank AG led by Eugen Weinberg in Frankfurt said in a report.
Rosneft, Russia’s largest oil producer, also plans to start its Siberian Suzun field in a month’s time, Chief Executive Officer Igor Sechin said Wednesday. However, distillate inventories rose 1.4 million barrels.
Investors are also focused on the Federal Reserve’s September monetary policy meeting, concluding later Wednesday.
“We will have to see if the trends normalize next week”, said John Kilduff, partner at NY energy hedge fund Again Capital in NY.
Crude futures still gained solid support on Wednesday with a strike by oil service workers in Norway helping to underpin global prices, while Japanese oil imports were also stronger than expected with a 0.5% annual increase for August.
West Texas Intermediate for November delivery rose as much as $1.09 to $45.14 a barrel on the New York Mercantile Exchange and was at $44.82 at 10:32 a.m.in Hong Kong.
American Petroleum Institute’s (API) weekly crude stocks data, revealed a 7.5 million barrel fall to 507.2 million barrels in USA crude inventories, while analysts expected a growth of approximately 2.3 million barrels.
Some market participants were puzzled by last week’s draw in USA crude when imports as a whole rose and refinery runs fell.
Zero Hedge noted that barrel prices are expected to remain “rangebound” until the Organization of Petroleum Exporting Countries’ unofficial meeting in Algiers next week, which many are hoping will end with some sort of agreement to curb OPEC’s crude oil production. The pipeline transports 1.3 million barrels of gasoline a day from the Gulf Coast refineries to the East Coast of the country.
US crude imports USOICI=ECI rose last week 77,000 barrels per day.
Production of oil in the country now stands at around 300,000 barrels per day, and reports suggest that could be increased if ports are open and secure.
US drillers added oil rigs for an 11th week in the past 12, in the week to September 16.
Advertisement
Pickens, who chairs investment firm BP Capital Management, stated he does not see crude rising to $100 a barrel, however, because of the size of USA reserves.
