Oil up as Kuwait revives hope for output freeze deal

SINGAPORE, Singapore—Oil prices climbed in Asia Wednesday after Kuwait said an agreement to freeze output during a producers’ meeting this month could still be reached despite conflicting statements by participants.

But analysts said the rebound would not likely last owing to a painful supply glut and weak demand caused by the slowing world economy.

At around 0430 GMT Wednesday, US benchmark West Texas Intermediate for delivery in May was up 97 cents, or 2.70 percent, at $36.86 and Brent crude for June was 68 cents, or 1.80 percent, higher at $38.55.

Both contracts eked out an increase on Tuesday, but prices are still well below the $40 level reached last month following a rally driven by hopes of an agreement during the April 17 producers’ meeting in Doha.

Prices dived after Saudi deputy crown prince Mohammed bin Salman said last week his country will only agree to limit output if rival producers such as Iran followed suit.

But Iran, which has been raising production since the West lifted nuclear-linked sanctions in January, has insisted it should not be the one to cut back.

Key OPEC member Kuwait, however, said a freeze deal can still be reached without Tehran, Bloomberg News reported.

It quoted Kuwait’s OPEC governor Nawal al-Fezaia as saying that major producers have no option but to reach an agreement and that a freeze could set a floor price.

Ric Spooner, chief market analyst at CMC Markets in Sydney, said traders are likely to wait for the results of the meeting before making big bets.

“Given the welter of statements… people are probably just going to ignore (the comments) until they get the results of the meeting,” Spooner told AFP by telephone.

Comments by International Monetary Fund chief Christine Lagarde that global economic recovery is still “too slow” and “too fragile” further added to the gloom in the saturated oil market as it is bad news for demand, analysts said.

source: business.inquirer.net

Oil stays below $40 after OPEC decides against output cut

SINGAPORE, Singapore — Oil stayed below $40 a barrel in Asia Monday after the OPEC cartel decided against slashing high output levels and traders turned their focus to a US central bank meeting next week.

US benchmark West Texas Intermediate for delivery in January was down 37 cents at $39.60 and Brent crude for January was trading 12 cents lower at $42.88 a barrel at around 0210 GMT.

At a meeting in Vienna on Friday, the Organization of the Petroleum Exporting Countries (OPEC) decided against cutting its oil output to lift prices, its president and Nigerian oil minister Emmanuel Ibe Kachikwu said.

OPEC, whose members together pump out more than one third of world oil, is currently producing above its official target of 30 million barrels per day despite a global crude supply glut that has battered prices for more than a year.

“Crude oil were no doubt compressed by the lack of an agreement at the OPEC, signaling that the supply glut will persist longer,” Bernard Aw, market strategist at IG Markets in Singapore.

“WTI is trading below the key $40 (mark) and it looks set to remain there.”

Sanjeev Gupta, who heads the Asia-Pacific oil and gas practice at professional services firm EY, said market attention is now turned to a meeting of Federal Reserve policymakers and to the latest economic data from China, the world’s top energy consumer.

Traders are watching whether the Fed will raise interest rates, a move that will boost the dollar. A stronger US currency will make dollar-priced oil more expensive to holders of weaker units, denting demand and prices.

“While all eyes are now on the Federal Reserve as it meets next week for the last policy meeting this year to decide whether to raise its benchmark rate, economic data from China will set the tone of prices in the coming weeks,” Gupta said.

He said the dollar also got a boost from a strong US jobs report on Friday. The report strengthens the case for a Fed rate hike, analysts said.

source: business.inquirer.net

Oil goes below $48 as Saudis defend stance

NEW YORK, United States – Oil prices tumbled Tuesday to fresh 5.5-year lows as Saudi Arabia blamed weak global economic growth and said it would stick to its guns on production policy.

US benchmark West Texas Intermediate for delivery in February sank $2.11 to $47.93 a barrel, a low last witnessed in late April 2009.

Brent North Sea crude for delivery in February dived $2.01 to $51.10 per barrel, the lowest level since early May 2009.

“The market is still worried that there are no signs that the supply glut will start falling,” Nordea Markets analyst Thina Margrethe Saltvedt told AFP.

James Williams of WTRG said the weakness in the market could take prices below $40 a barrel.

“Basically, there are continuing concerns about OPEC not cutting back, particularly Saudi Arabia, and US production continuing to grow,” he said.

Saudi Arabia’s Crown Prince Salman, in a speech on behalf of ailing King Abdullah Tuesday, said weak growth was to blame for the price fall, which has sliced deeply into the income of the world’s largest exporter.

“This development is not new in the oil market, and the kingdom has in the past dealt with it firmly and wisely,” he said, adding that Saudi Arabia will maintain its “same approach” towards the market.

That appeared to confirm Riyadh’s determination to defend its market share rather than reduce output, even if that pushes prices lower.

On Monday Saudi Arabia reportedly cut its European and US export prices in order to maintain market share.

source: business.inquirer.net

Oil prices fall amid weak China, German trade data

SINGAPORE – Oil prices fell in Asia Wednesday as dealers await the latest US supply report for clues about production levels, while weak Chinese and German trade data also weighed, analysts said.

US benchmark West Texas Intermediate for January delivery slipped 90 cents to $62.92 while Brent crude for January was down $1.01 at $65.83 in mid-morning trade.

“With the global supply glut, the main concern at the moment is the level of production in the US,” Daniel Ang, investment analyst at Phillip Futures in Singapore, told AFP.

“The US stockpiles report will be in focus to see if there is any change in production growth,” he said.

Analysts surveyed by the Wall Street Journal said they expected domestic inventories to have fallen by 2.7 million barrels in the week to December 5.

The American Petroleum Institute, an industry group, in its own survey however said stockpiles likely rose 4.4 million barrels.

It said refinery operations likely increased 1.6 percentage points to 94.6 percent of capacity.

The Department of Energy will release the official stockpiles report later Wednesday.

The department on Tuesday modestly reduced its 2015 US oil production forecast to 9.3 million barrels per day from the previous 9.4 million estimate.

Ang said German and Chinese trade data this week “have shown signs of dropping global demand and put pressure on oil prices”.

German exports slipped 0.5 percent month on month in October, while imports fell 3.1 percent. That came a day after China said exports grew just 4.7 percent year-on-year in November and imports dropped 6.7 percent.

Trade figures out of Germany and China, both major manufacturing giants, are closely watched for their impact on crude prices, especially the more internationally leveraged Brent contract.

source: business.inquirer.net

US stocks dip as oil pushes energy sector lower

NEW YORK—A slump in energy prices pushed the stock market back from record levels on Tuesday.

Energy stocks slid as the price of oil resumed its descent. Traders speculated that member nations of the oil-producing group OPEC would fail to agree on production cuts at an upcoming meeting in Vienna on Thursday. Oil has now dropped almost a third from a peak in June.

While lower oil prices are a long-term boon to consumers and industrial companies, they are a drag on stocks in the near term because energy companies account for about 10 percent of the overall market’s profits.

Despite the losses, the major indexes remain close to all-time highs.

Stocks have been drifting gradually higher this month, having rebounded sharply from a slump in October, as investors have grown more confident that actions from central banks around the world will help bolster the global economy. The gains are likely to continue for now, said Jim McDonald, chief investment strategist at Northern Trust.

“People’s sentiment is still pretty conservative,” McDonald said. “That means that the slow-and-steady market can continue longer than people anticipate.”

The Standard & Poor’s 500 index fell 2.38 points, or less than 0.1 percent, to 2,067.03. The Dow Jones industrial average dropped 2.96 points, or less than 0.1 percent, to 17,814.94. The Nasdaq composite gained 3.36 points, or 0.1 percent, to 4,758.25.

Stocks started the day with small gains after a report showed that the US economy grew at a solid 3.9 percent annual rate in the July-September period, faster than the 3.5 percent that was initially reported. The upward revision was due to higher estimates of spending by consumers and businesses, the Commerce Department said.

That positive report was tempered by news that US consumer confidence fell in November. The Conference Board says its consumer confidence index fell to 88.7, down from a seven-year high of 94.5 in October. The decline primarily reflected less optimism in the short-term outlook as consumers expressed less confidence in current business conditions.

Among individual stocks, Pall, a company that makes filters for the food and health care industries, was the leading gainer in the S&P 500. The company’s stock jumped $3.31, or 3.5 percent, to $98 after its earnings beat the expectations of Wall Street analysts.

Energy stocks slid along with oil prices following reports that the world’s biggest producers are unwilling to cut production to help stop a slump in the price of crude. The sector dropped 1.6 percent and is now down 3.2 percent for the year. It’s the only one of the 10 industry sectors in the S&P 500 that is down for the year.

Representatives from Venezuela, Saudi Arabia, Mexico and Russian state oil giant OAO Rosneft met Tuesday ahead of a meeting of the Organization of the Petroleum Exporting Countries in Vienna and didn’t announce any immediate plans to cut output, The Wall Street Journal reported.

Benchmark US crude fell $1.69 to close at $74.09 a barrel on the New York Mercantile Exchange. Brent crude, a benchmark for international oils used by many US refineries, fell $1.35 to close at $78.33 a barrel on the ICE Futures exchange in London.

In metals trading, the price of gold rose $1.40 to $1,197.10 an ounce. Silver rose 18 cents to $16.55 an ounce and copper fell four cents to $2.96 a pound.

US government bond prices rose. The yield on the 10-year Treasury note fell to 2.26 percent from 2.31 percent Monday. The dollar fell to 117.94 yen from 118.28 yen late Monday. The euro rose to $1.2472.

In other energy futures trading on the NYMEX:

— Wholesale gasoline fell 0.1 cent to close at $2.032 a gallon

— Heating oil fell 0.1 cent to close at $2.395 a gallon.

— Natural gas rose 13.1 cents to close at $4.282 per 1,000 cubic feet– Steve Rothwell

source: business.inquirer.net

Oil increases to highest level since 2008

(CNN) -- Oil prices spiked to their highest levels since 2008 on fears that tensions with Iran have the potential to disrupt supplies through the Strait of Hormuz.

The price of a barrel of brent crude hit $128.40 a barrel and eclipsed $110 on the New York Mercantile Exchange after a disputed report Thursday on Iran's Press TV and other Middle East outlets of a pipeline explosion in Saudi Arabia.

Prices for brent crude dropped to $125.45 and $108.50 on the NYMEX early Friday.

"I think the main problems are coming from some supply disruptions, or some fear to supply disruptions, particularly Iran," U.S. Federal Reserve Chief Ben Bernanke told a U.S. House Financial Services Committee on Wednesday. "So I'm not sure what could provide relief in the very short term."

The price of North Sea brent crude has risen more than 15% this year, while NYMEX crude has risen more than 8.5% on growing tensions surrounding Iran and fears that may lead to the closure of the Strait of Hormuz, a critical pathway for petroleum exports.

source: http://edition.cnn.com/2012/03/02/business/oil-prices/index.html?hpt=hp_t2

Oil hovers below $98 amid mixed US demand signs

SINGAPORE (AP) — Oil prices hovered below $98 a barrel Thursday in Asia amid mixed signs about the strength of U.S. crude demand.

Benchmark crude for March delivery was down 1 cent at $97.60 a barrel at midday Singapore time in electronic trading on the New York Mercantile Exchange. The contract fell 87 cents to settle at $97.61 on Wednesday.

Brent crude was steady at $111.56 a barrel on the ICE Futures Exchange in London.

A jump of U.S. crude inventories last week by 4 million barrels suggested oil consumption is sluggish. However, factories raised output in January by the most in seven months, the Institute for Supply Management said Wednesday while the Commerce Department said construction spending rose 1.5 percent in December, the fifth straight monthly gain.

Oil prices have hovered near $100 for the last few months amid mixed economic signs from the U.S., Europe and Asia. Some analysts expect crude to begin to rise as the global economy may grow more this year than previously expected.

"The crude oil price has become stuck in a remarkably extended period of narrow sideways trading," Barclays Capital said in a report. "However, the market is now likely to start to position for an upside break based on a greater degree of relaxation about macroeconomic prospects."

In other energy trading, heating oil rose 1.4 cents to $3.06 per gallon and gasoline futures were up 0.3 cents to $2.90 per gallon. Natural gas gained 0.8 cent to $2.39 per 1,000 cubic feet.

source: philstar.com