By Srinivas Chowdary Sunkara // petrobazaar // 24th May, 2018.
Oil prices are Pressurised
Brent closed up by 0.29% while WTI dropped by 0.5% yesterday. Dollar momentum continued to weigh on oil prices. The expected OPEC decision on rising production to offset Venezuela and Iran production pulling down oil prices. Libya's production cut would extend a little support. U.S oil prices are potentially hit by unexpected build in U.S crude and gasoline stocks as per EIA. Mr. Horald Hamm from continental resources says that he is not surprised of high oil prices and expecting further momentum.
Crude oil price update
U.S crude oil futures prices for July lost 36 cents to close at $71.84 per barrel on NYMEX while Brent futures to be delivered in July inched up by 23 cents at $79.8 a barrel on London based ICE futures Europe exchange. Today Asian markets are opened down.
EIA report – Summary
U.S energy watch dog, surprised the market with a report of unexpected build of crude and gasoline stocks by 5.8Mb and 1.9Mb. Oil prices may be further capped with increased U.S production by 2K bpd as per the report. Imports are increased and exports are slashed due to seasonal demand. Crude inputs into refinery were down by 7Kbpd with a rise in Operational percent utilization by 0.7%. Another bearish note is that Cushing stocks were slipped by 1.1Mb.
Whether we like it or not, Brent is trying to break $80 mark to reach $85 with cough and splutter. The underlying fact is that high oil prices are detrimental to demand growth as mentioned in FIS. Oil prices are lid by drop in longs and bearish stats.
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