Industry data from the American Petroleum Institute this week show a build of around 4.2 million barrels for the week ending December 23, while a survey from S&P Global Platts forecasts a draw of around 1.5 million barrels. Prices fell as investors became optimistic that production cuts will ease a global glut of oil that depressed prices over the last two years. Iraq, the second-biggest Opec producer, is fully committed to the accord, oil minister Jabbar Al-Luabi said Thursday in Cairo at a meeting of the Organization of Arab Petroleum Exporting Countries. This means these producers will have to rely on existing inventories to sell their barrels.
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Meanwhile, March brent oil delivery on the ICE Futures Exchange in London remained steady at 4 cents, or 0.07% and stood at $55.94 per barrel.
Futures advanced 0.4 per cent in NY, climbing for a seventh session. Visit MarketWatch.com for more information on this news.
Oil traded near the highest closing level in 18 months amid conflicting signs on whether the supply surplus is diminishing in the USA, the world’s largest fuel consumer.
“Without prejudicing its worldwide contractual obligations, from January 1 2017, (state oil company) PDVSA and/or its subsidiaries will implement a reduction in the volumes of its main crude sale contracts, all in conformity with existing terms and conditions”, the Venezuelan Energy Ministry said. It seemed that most of the major world oil producers have agreed on the November 30th Vienna accord, including the OPEC and non-OPEC deal of December 10th.
Abhishek Deshpande, a lead oil market analyst at Natixis, is positive: “For the first time in years, OPEC is actually looking, sounding and behaving like a cartel”. Several projects, including the final phase of Sidra Medical and Research Center, would be financed during the year. The global benchmark traded at a premium of $2.28 to WTI.
Products markets outpaced crude on Tuesday, as the price of reformulated blendstock gasoline 1RBc1 gained 1.8 percent to $1.6555 a gallon, while heating oil HOc1 gained 2.3 percent to trade at $1.7002 a gallon.
Canada and Russian Federation maintained their positions as first and second product suppliers to the USA, accounting for 24 per cent and 16 per cent, respectively, though imports from both countries were lower in September.
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The report also said that by May this past year rig count had plunged to 316, from a record high of 1,609 in October 2014.
