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Tag: Brent

  • Brent nears $70 on global supply

    Brent price, yesterday, moved towards $70 per barrel, as expectations of tight global supply outweighed pressure from rising United States (U.S.) inventories and production.

    Brent futures rose 16 cents to $69.47 per barrel, the highest since Nov. 12, when it last traded above $70.

    U.S. West Texas Intermediate (WTI) crude slipped 13 cents to $62.33 a barrel. The contract hit $62.99 on Thursday, also the highest since November.

    Brent has gained nearly 30 per cent this year, while WTI has risen nearly 40 percent. Prices have been underpinned by U.S. sanctions on Iranian and Venezuelan crude, along with OPEC production cuts and rising global demand.

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    According to Michael McCarthy, chief market strategist at CMC Markets in Sydney: “There is a clear bias to the upside with the supply restrictions. And there’s a much better than expected demand picture after the recent China and U.S. PMI numbers, along with a potential kicker from any U.S.-China trade agreement.

    He added that: ‘’And there’s a much better than expected demand picture after the recent China and U.S. PMI numbers, along with a potential kicker from any U.S.-China trade agreement,” McCarthy said.

     

     

  • JP Morgan: brent crude to hit $78

    Price of Brent crude will hit $78 per barrel in the next few months, on account of the dynamics in the global oil market, a global investment banking institution, JP Morgan report has said.

    It said the price is expected to hit $78 per barrel within months, as new productions and supplies kicks off among the members of the Organisation of Petroleum Exporting Countries (OPEC) and non- OPEC members.

    It said the price may fall to $64 and later rise to $67 per barrel, before rising to $78 in the second half of the year.

    The report’s projection aligns with that of Bank of America (BoA) and other banks, in respect to the growing prices of crude over the next half of this year.

    It said the projection by the crude price projection of $64 by the  BoA would increase later in the year.

    “The global economy will continue to expand, relative to the growth in the demand and supply prices of crude. The dynamics will also drive the WTI prices higher with the average for the year seen at $65.63 a barrel,” according to J.P. Morgan’s oil analysts.

    The report said despite the upbeat, the investment bank’s analysts recognised the danger of growing U.S. and other non-OPEC production.

    So, while their price forecasts are for the average level of Brent and WTI this year, the bank’s senior oil analyst Abhishek Deshpande noted in an interview with CNBC that “2018 is going to be a year of two halves.

  • Brent crude oil jumps to $63 per barrel

    Brent crude oil jumps to $63 per barrel

    Oil rose more than three per cent yesterday, pushing Brent crude to a 2015 high above $63 per barrel.

    The increase was due to evidence that U.S. production had dropped, balancing a market that had been in heavy oversupply for more than a year.

    Oil prices collapsed in the six months to January, pushing Brent down more than 60 per cent to almost $45 a barrel.

    But the market has gradually recovered this year as much lower prices have discouraged oil exploration and production, especially in the United States.

    “People are realising that the U.S. production juggernaut is slowing, at least for now,” said Virendra Chauhan, oil analyst at London-based consultancy Energy Aspects.

    “U.S. production is down for the second time in three weeks and refinery runs are spiking up, driving demand higher.”

    Brent crude futures for June LCOc1 on Thursday hit $63.29 a barrel, the highest since December.

    However, U.S. crude CLc1 was at $56.00, down 39 cents after hitting a 2015 high of $56.69 on Wednesday.

    “This whole rally was primarily due to drops in U.S. crude production.

    “We see the four-week average for crude production turning negative for the first time since July ’14,” Singapore-based energy brokerage Phillips Futures said in a note to clients.

    But analysts say despite the oil price rally, the market remains over supplied and this can reduce the price in the short term.

  • Brent falls below $69 as price rout rolls on

    Brent crude slipped below $69 a barrel yesterday on track to finish the week below $70 a barrel for the first time since 2010, as cuts to official selling prices from Saudi Arabia added to recent pressure.

    Prices remain near five-year lows as the market grapples with oversupply due to the U.S. shale boom and the recent decision by the Organization of Petroleum Exporting Countries not to cut production.

    Prices pared early losses after stronger-than-expected U.S. employment data, while a slightly lower physical supply from the program that underpins the Brent crude benchmark in January also provided support.

    But analysts said the Saudi cuts to monthly prices for crude it sells to the United States and Asia just a week after blocking cuts to OPEC’s output show it is stepping up its battle for market share.

    “It’s been weighing on the market, showing that OPEC is not ready to end its price war,” said Commerzbank analyst Eugen Weinberg. “The lower the better seems to be the new paradigm for OPEC.”

    The January Brent crude contract fell by $1.14 to $68.50 a barrel, on track for the ninth loss in 10 weeks. U.S. crude was down $1.35 at $65.46.

    At the same time, oversupply could rise next year when Iraq starts to export more oil as a result of an agreement between Baghdad and the Kurdish regional government.

    Libya is also set to restart its largest oilfield, El Sharara, once a pipeline blockage is cleared.

    The combined pressure is preventing Brent from rebounding from a near 13-percent plunge last week.

    The fall may put global oil and gas exploration projects worth more than $150 billion on hold next year, potentially curbing supply by the end of the decade.

    Fatih Birol, chief economist with the International Energy Agency, said yesterday he sees oil prices rising to near $100 a barrel in the coming years. Analysts also expect oil prices to rebound in the next two years, averaging $82.50 a barrel in 2015, a Reuters poll showed.