Oil rises more than one percent on hopes of market rebalance, trade deal
By Collin Eaton HOUSTON (Reuters) - Crude prices rose more than 1 percent on Wednesday to their highest this year, on hopes that oil markets will balance later this year, helped by output cuts from top producers as well as U.S.
By Collin Eaton
HOUSTON (Reuters) - Crude prices rose more than 1 percent on Wednesday to their highest this year, on hopes that oil markets will balance later this year, helped by output cuts from top producers as well as U.S. sanctions on OPEC members Iran and Venezuela.
Market fears over trade talks between the United States and China had helped push oil prices lower in early trade, but the market reversed after signs of progress emerged on Wednesday and strengthened equity markets.
U.S. President Donald Trump said negotiations with China were going well and suggested he was open to extending the deadline to complete them beyond March 1, when tariffs on $200 billion worth of Chinese imports are scheduled to rise to 25 percent from 10 percent.
Brent futures were up 78 cents, or 1.2 percent, at $67.23 a barrel by 1:46 p.m. EST (1846 GMT), after hitting a 2019 high of $67.38.
U.S. West Texas Intermediate crude (WTI) for delivery in March were at $57.10 a barrel, up $1.01, or 1.8 percent, ahead of the contract's expiry. The more active April contract was up 87 cents at $57.32.
"The market this week has pushed to three-month highs on expectations of tightened supplies," said Gene McGillian, vice president of market research at Tradition Energy in Stamford, Connecticut. "OPEC and Russia are enacting cuts and concerns about reduced Venezuelan exports have helped push markets up."
The Organization of the Petroleum Exporting Countries and other producers, including Russia - an alliance known as OPEC+ - agreed to reduce oil supply by 1.2 million barrels per day from Jan. 1 this year.
Saudi Energy Minister Khalid al-Falih said he hoped the oil market would be balanced by April and that there would be no gap in supplies due to U.S. sanctions on Iran and Venezuela.
"You could take that as a signal that Saudi Arabia will continue to take a proactive approach," said Andy Lipow, president of Lipow Oil Associates in Houston.
Some supply disruptions have further tightened supplies.
Saudi state oil firm Aramco last week shut part of its Safaniyah offshore oil field after a power cable was inadvertently cut. Production at Libya's contested El Sharara field has been halted since December.
U.S. sanctions on Iran and Venezuela have also helped to reduce the availability of crude on the global market.
However, price gains were capped as those supply disruptions were offset by expectations of inventory builds in the United States following a sharp reduction in refineries' capacity utilization in the midwestern United States.
U.S. crude stockpiles were expected to have risen by 3.1 million barrels last week, the fifth consecutive weekly build, an extended Reuters poll showed.
Inventories at Cushing, Oklahoma, the main U.S. oil storage hub, will grow largely because U.S. data shows refinery capacity utilization in the Midwest dropped to 84.2 percent from 92.9 percent the previous week, following a string of planned and unplanned outages, analysts said.
"That will leave a lot of barrels on the sidelines," said Robert Yawger, director of energy futures at Mizuho in New York.
Weekly U.S inventory data is delayed by a day due to the Presidents Day holiday on Monday. The American Petroleum Institute will release its data at 4:30 p.m. EST (2130 GMT), while the U.S. Energy Information Administration report is due on Thursday at 11 a.m. EST (1600 GMT).
The EIA said on Tuesday shale production alone will hit a record 8.4 million bpd next month, suggesting little chance of a near-term slowdown in overall U.S. crude output.
BNP Paribas said surging U.S. output would feed into lower oil prices towards the end of the year, with Brent to dip to an average of $67 by the fourth quarter and WTI to average $61.
"U.S. oil production growth, driven by shale, will be increasingly exported in greater volumes to international markets while the global economy is expected to witness a synchronised slowdown in growth," the bank said.
(Additional reporting by Amanda Cooper in LONDON, Henning Gloystein in SINGAPORE; Editing by Marguerita Choy and Kirsten Donovan)
This story has not been edited by Firstpost staff and is generated by auto-feed.
Find latest and upcoming tech gadgets online on Tech2 Gadgets. Get technology news, gadgets reviews & ratings. Popular gadgets including laptop, tablet and mobile specifications, features, prices, comparison.
By Jessica Resnick-Ault NEW YORK (Reuters) - Oil prices strengthened on Wednesday, as OPEC and its allies were seen complying with a pact to cut oil supply in September, even as concerns loomed that recovery in fuel demand will be stalled by soaring global coronavirus cases. Early in the day crude was boosted by a bullish stock market. Even as equities whipsawed on pandemic worries, oil stayed higher, buoyed by expectations that OPEC could staunch a supply glut
By Tina Bellon and C Nivedita (Reuters) - Tesla Inc will further cut the price of its Model S "Long Range" sedan in the United States to $69,420, the electric carmaker's chief executive, Elon Musk, announced in a tweet https://bit.ly/2H0JCP0 on Wednesday. The anticipated drop marks the second time this week Tesla has cut the price for the high-end sedan, following a 4% cut of the Model S's price in the United States on Tuesday to $71,990.
By Jeff Mason DES MOINES, Iowa (Reuters) - Under siege over his handling of the novel coronavirus pandemic, President Donald Trump on Wednesday cited what he said was his son's mild bout of the virus as a reason why American schools should reopen as soon as possible. Trump made the comment about his son, Barron, as the president swept into Iowa on a mission to shore up support in battleground states that he won in 2016 but is in danger of losing to Democrat Joe Biden barely three weeks before the election. First lady Melania Trump announced in a statement earlier in the day that the virus that struck both her and her husband had also infected their 14-year-old son