Source : Investing.com
Crude prices fell in Asia on Friday with the global supply outlook bearish and demand lagging.
On the New York Mercantile Exchange, WTI crude for March delivery
fell 0.94% to $30.48 a barrel. Brent eased 1.08% to $33.91 a barrel.
Later Friday, research group Baker Hughes is expected to report rig count data
in the U.S.. It last week that that the number of rigs drilling for oil
in the U.S. decreased by 28 to 439 in the previous week.
Overnight, crude futures pared most of its earlier gains on Thursday,
after an unexpected build in U.S. inventories last week pushed
inventories to near full storage capacity.
It marked the first time in nearly two weeks that U.S. crude
futures remained above $30 a barrel for the entirety of a session. A
day earlier, the front month contract for WTI crude surged more than 8%,
after Iran oil minister Bijan Zanganeh said his nation supports a
so-called Doha Agreement, in which four top producers have pledged to
freeze output at their January levels in an effort to bolster
persistently low prices.
On the Intercontinental Exchange, Brent crude
for April delivery traded between $34.09 and $35.73 a barrel, before
closing at $34.20, down 0.31 or 0.90% on the session. North Brent Sea
futures also soared more than 8% on Thursday, capping a four-day stretch
where the international benchmark for crude jumped more than $4 a
barrel or 15%.
On Thursday morning, the U.S. Energy Information Administration (EIA)
said in its Weekly Petroleum Status Report that commercial crude
inventories for the week ending on February 12 rose by 2.1 million
barrels from the previous week. At 504.1 million barrels, U.S. crude oil
inventories remain at historically high levels for this time of year.
Total motor gasoline inventories increased by 3.0 million barrels last
week, while distillate fuel inventories rose by 1.4 million barrels.
Although the build fell below consensus estimates of a 3.9 million
barrel increase, investors for the most part anticipated a significant
draw after the American Petroleum Institute reported a weekly decline of
3.3 million barrels on Wednesday evening. Both reports were released a
day later than usual this week due to Monday's Presidents Day holiday.
At the Cushing Oil Hub in Oklahoma, inventories rose by only 36,000,
defying expectations for an increase of 500,000. The figures exacerbate
concerns that Cushing officials could be denying storage requests, as
capacity at the nation's largest storage facility approaches its limit.
Furthermore, a number of analysts found the data to be confounding given
that Genscape, Inc. estimated a weekly build of 705,000 just days
earlier.
U.S. production, meanwhile, fell sharply by 51,000 barrels per day to
9.135 million bpd for the week. It represented the fourth straight week
of weekly declines and the second consecutive week that output dipped
below the 9.2 million bpd threshold.
In the Middle East, United Arab Emirates oil minister Suhail bin
Mohammed al-Mazrouei criticized Iran for their intentions to continue to
pump oil, while their counterparts in the region are advocating a
production freeze. It came one day after Zanganeh said he backed a plan
by Saudi Arabia, Russia, Venezuela and Qatar to cap their production at
levels reached last month. Still, Zanganeh stopped short of approving
any deal which requires Iran to limit their production before it can
return to pre-sanction levels from 2007.
“Anyone who is introducing more supply into the market in the current
situation is going to make it worse. That’s obvious, I don’t think we
need a scientist to tell you that," Mazrouei told reporters at a
conference in Abu Dhabi. "They are entitled to produce whatever they
want, whether it’s 100,000 or 200,000 or 500,000 but (it's not) going to
help the situation.”
