Oil slips despite weak dollar as U.S. stockpiles remain high | Reuters
By Devika Krishna Kumar | NEW YORK NEW YORK Oil prices slipped on Thursday, as support from a weaker dollar was offset by U.S. crude inventories near record high levels that again raised concerns whether OPEC-led output cuts were starting to drain a global glut.The Organization of the Petroleum Exporting Countries and some non-OPEC producers cut production from Jan. 1 to reduce record stocks of crude.
By Devika Krishna Kumar
| NEW YORK
NEW YORK Oil prices slipped on Thursday, as support from a weaker dollar was offset by U.S. crude inventories near record high levels that again raised concerns whether OPEC-led output cuts were starting to drain a global glut.The Organization of the Petroleum Exporting Countries and some non-OPEC producers cut production from Jan. 1 to reduce record stocks of crude. But an oil price rally after the deal has been hobbled by data showing persistently rising U.S. stockpiles.Latest data from market intelligence firm Genscape showed a build of more than 2 million barrels in the week to March 14 at the Cushing, Oklahoma delivery point for U.S. crude futures, traders said.Data on Wednesday showing a modest slide in crude stockpiles in the United States, the world's biggest oil consumer, had helped lift oil prices after a week-long rout spurred by record U.S. inventories pushed them to three-month lows.The U.S. Energy Information Administration said on Wednesday that crude inventories fell last week, the first decline after nine weeks of increases, but only by a dip of 237,000 barrels from a record high. It also reported Cushing stocks jumped 2.1 million barrels in the week to March 10.
Brent crude LCOc1 ended the session 7 cents lower at $51.74 a barrel, recovering from Tuesday's drop to $50.25, its lowest since Nov. 30 when OPEC announced its supply accord. The price is still nearly $7 below January's post-deal peak of $58.37.U.S. light crude CLc1 settled 11 cents lower at $48.75 a barrel, but still above the three-month low hit on Tuesday.
Prices also got a brief lift after Bloomberg reported Saudi Energy Minister Khalid Al-Falih as saying the cuts could be extended if inventories remain above average."Market focus remains centred on escalating U.S. production growth and elevated domestic inventory levels, but this is not representative of the rest of the world. Inventories are drawing in several other key regions," RBC Capital Markets analysts said in a note."Despite the broad-based headlines of a holistic global oil surplus, we contend that certain markets such as Asia remain in a deficit, while regions like the Atlantic Basin and the U.S. remain in surplus."
Some support came from the U.S. Federal Reserve on Wednesday after it signalled it would not accelerate plans to raise interest rates, depressing the dollar against a basket of currencies .DXY and lifting the greenback-denominated oil price.[USD/]"I don't think that's going to be a massive influence at this point in time and the main reason being that it is a small move and the risk trade is still on at this point," said Mark Watkins, regional investment strategist at the Private Client Group at U.S. Bank in Park City, Utah."Unless there is a global disruption where money needs to move to a safe haven, the interest rate movement isn't going to have a long term material impact at this point in time." (Additional reporting by Edmund Blair in London, Aaron Sheldrick in Tokyo; Editing by Marguerita Choy and Dale Hudson)
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By Robin Emmott and John Irish | BRUSSELS/PARIS BRUSSELS/PARIS France and Germany will agree to a U.S. plan for NATO to take a bigger role in the fight against Islamic militants at a meeting with President Donald Trump on Thursday, but insist the move is purely symbolic, four senior European diplomats said.The decision to allow the North Atlantic Treaty Organization to join the coalition against Islamic State in Syria and Iraq follows weeks of pressure on the two allies, who are wary of NATO confronting Russia in Syria and of alienating Arab countries who see NATO as pushing a pro-Western agenda."NATO as an institution will join the coalition," said one senior diplomat involved in the discussions. "The question is whether this just a symbolic gesture to the United States
BEIJING Chinese President Xi Jinping on Wednesday called for greater efforts to make the country's navy a world class one, strong in operations on, below and above the surface, as it steps up its ability to project power far from its shores.China's navy has taken an increasingly prominent role in recent months, with a rising star admiral taking command, its first aircraft carrier sailing around self-ruled Taiwan and a new aircraft carrier launched last month.With President Donald Trump promising a US shipbuilding spree and unnerving Beijing with his unpredictable approach on hot button issues including Taiwan and the South and East China Seas, China is pushing to narrow the gap with the U.S. Navy.Inspecting navy headquarters, Xi said the navy should "aim for the top ranks in the world", the Defence Ministry said in a statement about his visit."Building a strong and modern navy is an important mark of a top ranking global military," the ministry paraphrased Xi as saying.