“Contracts traded during the five-day period ending August 4 suggest the market expects WTI prices could range from $29 a barrel to $61 a barrel (at the 95 per cent confidence interval) in November 2016”, the report said.
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“The resulting product stock draw (fall in stockpiles) will increase refiners’ appetite for crude oil and help pave the way to a sustained tightening of the crude oil balance”.
Crude oil futures fell by 0.21 per cent to Rs 2,856 per barrel on August 10 as speculators cut down their bets amid weak cues from the Asian markets. Overall, Brent crude has fallen from above $115 in June 2014 to a current rate of approximately $45.
Oil prices had hovered about the $50 mark in June and early July initially signalling what oil and energy ministers in Saudi Arabia, the United Arab Emirates and the U.S. said was a coming period of “balance” in supply and demand. “EIA is now expecting U.S. output to reach 8.31 million barrels per day in 2017, up from its forecast of 8.2 million barrels per day in July”, ANZ Bank said on Wednesday. Such gains, however, are unlikely to hold even in the short-term. Mohammed Al-Sada, who is both Qatar’s minister of energy and industry, stated on Monday morning that there will be higher oil prices since , “higher oil demand is expected in the third and fourth quarters”.
International Brent crude futures were at $43.72 a barrel, down 33c, or 0.8%.
In the month of July, Saudi Arabia produced a record oil output of 10.67 million barrels, while crude supplies from Iraq and Iran were also expected to reach new record levels.
“Lower-than-predicted demand, high refined product stocks during the peak summer driving season and rising crude supply…have all significantly exerted pressure over the month”, OPEC said in its monthly report.
Two factors have caused the glut to disappear: Deep output cuts by producers outside the Organization of the Petroleum Exporting Countries cartel, and healthy global demand for crude oil, the IEA said.
Crude oil prices moved slightly higher at the start of trading Wednesday after a monthly report from OPEC showed a slight increase in overall demand.
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The UAE also hit a record production of 3.18 million bpd, up 13,000 bpd on the month.
