By Srinivas Chowdary Sunkara // petrobazaar // 29th Dec, 2018.
Brent rose 4 cents to settle at $52.2 and WTI futures went up by 72 cents to close at $45.33 a barrel on Friday. Both the front month crude futures lost for third consecutive week in a row amid high volatility. Crude markers closely followed the rally in equity markets on Friday. EIA report of smaller than expected drawings in U.S crude stocks failed to spur the buying interest. Build in gasoline stocks trounced analysts expectations. Baker Hughes reported additional oil rigs of 2 Nos in to U.S drilling, Indicated further ramp up in crude production.
In the year 2018, Crude oil prices showed wild swings across the year. Although the year 2018 started with OPEC production cuts deal along with the tight fundamentals, over a period, the euphoria evaporated which drived down prices by above 20 pct by the end of the year. OPEC is heading to 2019 with another supply cut pact which is expected to balance the first half of 2019. The softening of demand may negate the positive impact of production cuts pact which may push the market into the state of surplus in the second half of the new year. As predicted earlier, U.S will be supplying at 11.4M and the exports of U.S oil may gain momentum due to which the spread will narrowed to the lowest. The crude price is estimated to hover around $60 based on the above conditions in the year 2019. Happy week end.
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