News and analysis

Oil prices rose on Wednesday


U.S. WTI crude for November futures closed up 38 cents, or 0.75 percent, at $51.30 a barrel on Wednesday. Brent crude for December futures closed up 33 cents, or 0.58 percent, at $56.94 a barrel. The latest monthly report from the organization of petroleum exporting countries shows that the rate of production cuts remains high, while the dollar continues to weaken, providing an effective support for oil prices. U.S. WTI crude oil futures hit a session high of dollar/barrel, while brent futures hit the dollar at the highest level.

Fundamentals positive factors:

, according to the latest monthly report from the organisation of the petroleum exporting countries (OPEC) global oil markets next year to the organization, oil demand will reach 33.06 million barrels per day is expected increased before 230000 barrels a day, this is the OPEC since July for a third straight month to raise oil demand is expected next year. Although the 89000 barrels of crude oil production in September growth/solstice 32.75 million barrels a day, but Reuters calculation results show that currently involved in production of 11 OPEC production cuts are enforced is still high at 98%.

Fed officials believe the U.S. economy is growing steadily and will raise interest rates later this year, despite some differences on inflation, according to minutes from the fed's latest meeting. After the minutes, the dollar index did not rise against the fall, which provided some support for oil prices.

Saudi Arabia plans to cut oil exports by 5.6 million barrels per day in November, in support of OPEC's led production cuts. In the United States, the oil market has also been supported by the shutdown of several oil refineries along the gulf coast because of hurricane nate. , on the other hand, according to the U.S. government, according to the gulf coast, about 85% of the crude oil output by nate hurricane forced offline, or about 1.49 million barrels a day, it will continue to support oil prices in the short term.

OPEC next policy meeting will be held in Vienna on November 30, will discuss how to help the oil market issues such as return to equilibrium, the market focus is a further extension of the cuts. OPEC secretary general barr jindu (Mohammad Barkindo) said in a speech on Sunday, is now considering whether to extend production agreement until after the end of March 2018 options, at the same time, more producers will also join the production agreements, all this will be discussed at a meeting in November. In addition, Mr. Barkin said in an interview today that he has seen clear signs of a return to equilibrium in the oil market.

American oil company Baker Hughes (Baker Hughes) according to the data published on Friday (6 October), as of October 6th week, an American oil drilling fewer active 2 to 748, over the past five weeks fourth recorded down, because of lower oil prices increased before us shale oil companies to cut costs. More data showed the total number of active drilling RIGS in the United States increased by four to 936 in the week ended Oct. 6.

Fundamental bearish factors:

The U.S. energy information administration (EIA) on Wednesday (October 11) short-term monthly energy outlook report released by the U.S. crude oil output growth next year is expected to be greater than previous estimates, cut its global oil demand growth is expected in 2018. The EIA expects U.S. crude production to rise 680,000 barrels a day to 9.92 million barrels a day in 2018, according to detailed data. Last month, the EIA forecast an increase of 590,000 barrels to 9.84 million barrels a year. Meanwhile, the EIA expects us crude oil production to rise by 380,000 barrels a day in 2017 to 9.24m barrels a day, and last month it was expected to increase by 400, 000 barrels a day to 9.25 million barrels a day. According to more data, the EIA maintained a forecast of 1.35 million barrels per day of global crude demand growth in 2017, but lowered the forecast for global crude demand in 2018 by 110,000 barrels/solstice1.58 million barrels per day.

The U.S. energy information administration (EIA) on Wednesday (October 4), according to data released Sept. 29, the week, the United States 1.525 million barrels of crude oil inventories of main delivery basement hin, six straight week growth, and create the week (29 weeks) since March 17. U.S. gasoline inventories rose 16.44 million barrels, the highest level since the week of August 11 (8 weeks), and the market forecast for a rise of 108.8 million barrels. Last week, U.S. crude oil exports rose by 49.3 million BPD/solstice, 198.40, 000 barrels per day for four consecutive weeks. Meanwhile, U.S. crude oil and crude exports hit a record high of 7.02 million barrels per day last week.

Sharara, Libya's largest oil field, has resumed production, which will provide more than 230,000 barrels per day of supply for the oil market, which was shut down last Sunday due to force majeure.

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