Oil up on de­mand fore­cast, Kur­dis­tan ten­sions

Business World - - WORLD MARKETS -

NEW YORK — Oil prices rose for the third day on Wed­nes­day as the Or­ga­ni­za­tion of the Petroleum Ex­port­ing Coun­tries (OPEC) fore­cast higher de­mand for 2018 and height­ened ten­sions in Kur­dis­tan sup­ported prices.

Brent crude fu­tures rose 33 cents, or 0.60%, to set­tle at $56.94 per bar­rel. Brent rose two per­cent the pre­vi­ous day.

US West Texas In­ter­me­di­ate crude fu­tures rose 38 cents, or 0.80%, to $51.30 a bar­rel.

OPEC fore­cast stronger de­mand for its oil in 2018 and said pro­duc­tion cuts by pro­duc­ing na­tions were clear­ing the global crude glut.

US oil ex­ports are pour­ing into the mar­ket at a record pace, but the world’s sec­ond largest crude trader Glen­core said the mar­ket can ab­sorb the vol­umes along with those from the North Sea and West Africa.

“I think the mar­ket is able to ab­sorb that two mil­lion bpd ( bar­rels per day) of US ex­ports eas­ily,” Glen­core’s head of oil trad- ing Alex Beard told the Reuters Global Com­modi­ties Sum­mit. “I don’t think there are many losers out there.”

Saudi Ara­bia said it pumped 9.97 mil­lion bpd in Septem­ber, up from Au­gust, but still be­low tar­get.

OPEC and other pro­duc­ers, in­clud­ing Rus­sia, agreed to cut out­put by 1.80 mil­lion bpd. The United States is not party to the deal, and its crude out­put has risen 10% this year to more than 9.50 mil­lion bpd.

After set­tle­ment, crude prices pared gains when the in­dus­try group the Amer­i­can Petroleum In­sti­tute ( API) said its data showed US crude stocks rose un­ex­pect­edly last week, while gaso­line in­ven­to­ries de­creased and dis­til­late stocks built.

API said crude in­ven­to­ries rose 3.10 mil­lion bar­rels in the week to Oct. 6. An­a­lysts had ex­pected a draw of two mil­lion bar­rels. The US De­part­ment of En­ergy re­ports off icial data on Thurs­day.

Rob Ha­worth, se­nior in­vest­ment strate­gist at US Bank Wealth Man­age­ment said OPEC and oil bulls were “hop­ing US pro­duc­ers slow down pro­duc­tion and make fur­ther progress on in­ven­tory cuts.” He said the pic­ture was “not clear be­cause you still have hur­ri­cane re­lated news.”

Iraqi govern­ment forces and Ira­nian- trained Iraqi paramil­i­taries are “pre­par­ing a ma­jor at­tack” on Kur­dish forces in the oil-rich re­gion of Kirkuk and near Mo­sul in north­ern Iraq, the Kur­dis­tan Re­gional Govern­ment said.

Al­though an Iraqi mil­i­tary spokesman de­nied any at­tack, John Kil­duff, a part­ner at Again Cap­i­tal LLC, said “wor­ries over Kur­dis­tan are help­ing… get us back over 51.” —

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