The U.S. Energy Department’s weekly inventory release showed another significant stockpile increase of more than 3 million barrels as refiners scaled down their utilization rates to lowest since February The “bearish” report further revealed that gasoline supplies surged unexpectedly.
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It marks the lowest monthly output in the last 12 months.
The hull of Anadarko Petroleum Corp.’s Lucius truss spar in Ingleside, Texas, U.S.
“Repealing the 1970s-era ban on USA crude oil exports would do just that”.
But the decline in production provides fresh evidence of the fallout from the dramatic decline in oil prices in the past year and a half. The U.S. crude oil production peaked at 9.6 MMbpd in April 2015-the highest level since the 1970s.
It is exactly the outcome that OPEC was hoping to achieve.
Obama’s opposition to oil exports, however, comes as his administration is finalizing a deal to end economic sanctions against Iran.
Oil prices traded in a narrow range in September as investors assessed how long the global glut of crude oil-which sent prices plunging in the past year-would persist.
“This is very significant”.
“Today’s report was a complete disaster for those who bet on higher prices as it shows inventories and production are up”, said Rob Haworth, a senior investment strategist in Seattle at US Bank Wealth Management, which oversees $128 billion of assets. At the same time, the EIA believes that oil demand in 2016 will rise by another 100,000 barrels per day as compared to the earlier update.
The oversupply of oil, which is blamed for the price crash of 2014, is starting to improve. Shares of Diamond Offshore Drilling, Transocean and Chesapeake Energy jumped more than 4% apiece. An oil trader at a leading Japanese trading house said he is keeping an eye on developments, but there are many uncertainties such as trading restrictions imposed by the Chinese authorities.
On the Multi Commodity Exchange, crude oil for delivery in November was up by Rs 8 or 0.26 per cent at Rs 3,090 per barrel with a business turnover of 130 lots. As oil is priced in dollars, it becomes more expensive for holders of other currencies as the greenback appreciates.
Commerzbank analyst Carsten Fritsch told the news agency: “Those expectations drove prices upwards, so that’s being reassessed and it’s possible we’ll see prices dropping below $50 again”.
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U.S. crude output increased 76,000 bpd to 9.17 million last week, according to EIA data. Supplies were forecast to have gained by 2.25 million barrels last week, according to a Bloomberg survey.
