Oil up on OPEC out­put cut; US re­fin­ery restarts

Business World - - WORLD MARKETS -

NEW YORK — Oil prices rose on Tues­day af­ter the Or­ga­ni­za­tion of the Petroleum Ex­port­ing Coun­tries (OPEC) forecast higher de­mand in 2018 and Rus­sia and Venezuela con­firmed their com­mit­ment to a pro­duc­tion­cut­ting deal to re­duce the global crude glut.

In its monthly re­port, OPEC also said the two hur­ri­canes that hit the United States in re­cent weeks would have a “neg­li­gi­ble” im­pact on de­mand.

About 6.10 mil­lion cus­tomers were with­out power fol­low­ing hur­ri­cane Irma, down from a peak over 7.40 mil­lion late Mon­day, ac­cord­ing to lo­cal util­i­ties.

The mar­ket was as­sess­ing Irma’s ef­fect on de­mand, even as re­fin­ery restarts in the wake of hur­ri­cane Har­vey boosted ex­pec­ta­tions for crude oil con­sump­tion.

The largest re­fin­ery in the United States, in Port Arthur Texas, was run­ning at re­duced rates, sources told Reuters.

Brent crude set­tled up 43 cents or 0.80% to $54.27 per bar­rel. Its ses­sion low was $53.42.

US West Texas In­ter­me­di­ate was up 16 cents or 0.30% to $ 48.23 a bar­rel. It hit a ses­sion low of $47.73.

US crude stock­piles rose nearly twice ex­pected lev­els last week as re­finer­ies cut out­put fol­low­ing hur­ri­cane Har­vey, while gaso­line and dis­til­late in­ven­to­ries drew, in­dus­try group the Amer­i­can Petroleum Institute (API) said af­ter the mar­ket set­tled.

Af­ter the API re­port, US gaso­line fu­tures rose, sur­pass­ing their ses­sion high.

Crude in­ven­to­ries rose by 6.20 mil­lion bar­rels in the week to Sept. 8 to 468.80 mil­lion, com­pared with an­a­lysts’ ex­pec­ta­tions for an in­crease of 3.20 mil­lion bar­rels.

The US Depart­ment of En­ergy’s En­ergy In­for­ma­tion Ad­min­is­tra­tion (EIA) re­ports Wed­nes­day. This week’s num­bers might be in­com­plete in­di­ca­tors of the longer-term sup­ply and de­mand out­look, said Mark Watkins, re­gional in­vest­ment man­ager at US Bank. “Over the next two to three weeks, the EIA in­ven­tory num­bers will be rather sloppy be­cause you have pro­duc­tion dis­rupted, re­finer­ies go­ing off­line and on­line,” he said, adding that OPEC fig­ures are a bet­ter sig­nal. “That’s why you have to look out fur­ther.”

Out­put by OPEC’s 14 mem­ber coun­tries fell in Au­gust by 79,000 bar­rels per day ( bpd) from July to 32.76 mil­lion bpd.

Should OPEC keep pump­ing at Au­gust’s rate, the mar­ket would see a small sup­ply deficit next year, ver­sus a 450,000-bpd sur­plus im­plied by last month’s re­port.

OPEC said in­ven­to­ries were fall­ing and noted a ris­ing pre­mium of Brent crude for im­me­di­ate de­liv­ery over that for later sup­plies.

Rus­sian and Venezue­lan en­ergy min­is­ters met in Moscow and con­firmed their com­mit­ment to the out­put cut deal. —

Newspapers in English

Newspapers from Philippines

© PressReader. All rights reserved.