Oil prices are falling during trading on Friday after a steady rise the day before.
December futures for Brent on London’s ICE Futures exchange fell by $0.77 (0.79%) by 8:00 a.m. to $96.19 per barrel. As a result of trading on Thursday, they rose by $1.27 (1.33%) to $96.96 per barrel.
Quotes of WTI futures for December in electronic trading on the New York Mercantile Exchange (NYMEX) by the specified time decreased by $0.94 (1.06%) to $88.14 per barrel. According to the results of previous trading, they increased by $1.17 (1.33%) to $89.08 per barrel.
Despite Friday’s decline, oil prices may end the week with growth on the back of a sharp fall in the dollar, as well as data on US exports.
Meanwhile, investors remain cautious amid an uncertain demand outlook due to rising inflation, higher interest rates and growing recession risks, writes Trading Economics.
Earlier this week, it became known that US commercial oil inventories increased by 2.59 million barrels last week, while experts polled by Bloomberg expected a more moderate increase – by 1.5 million barrels.
The US Department of Energy report also reported that gasoline inventories fell by 1.48 million barrels, while distillate reserves increased by 170 thousand barrels. Analysts predicted a decline in gasoline by 1.5 million barrels, distillates – by 1 million barrels.
Oil prices rise moderately on Thursday morning after rising to two-week highs the day before, provoked by the depreciation of the dollar and data on the reduction of gasoline inventories in the United States.
The price of December futures for Brent on London’s ICE Futures is $95.93 per barrel by 8:02 a.m., which is $0.24 (0.25%) higher than the closing price of the previous session. As a result of trading on Wednesday, these contracts rose by $2.17 (2.3%) to $95.69 per barrel.
The price of futures for WTI oil for December in electronic trading on the New York Mercantile Exchange (NYMEX) is $88.1 per barrel by this time, which is $0.19 (0.22%) higher than the final value of the previous session. A day earlier, the contract rose in price by $2.59 (3%) to $87.91 per barrel.
As it became known on Wednesday from the report of the US Department of Energy, commercial oil reserves in the country increased by 2.59 million barrels last week, while experts polled by Bloomberg expected a more moderate increase – by 1.5 million barrels.
Inventories of gasoline decreased by 1.48 million barrels, while distillate reserves increased by 170 thousand barrels. Analysts predicted a decrease in gasoline stocks by 1.5 million barrels, distillates – by 1 million barrels.
“Drunken gasoline inventories suggest that the economy and driving may not be as bad as expected,” said Michael Lynch, president of Strategic Energy & Economic Research.
Meanwhile, the ICE-calculated index, which shows the dynamics of the dollar against six major world currencies, fell 1.2% the day before. Wednesday’s rise in oil prices “was actually the result of the dollar’s decline,” Phil Flynn, senior analyst at The Price Futures Group, told MarketWatch.
Oil prices are falling on Wednesday morning after a moderate rise the day before, caused by concerns about the supply of fuel on the world market and the weakening dollar.
The price of December futures for Brent on London’s ICE Futures exchange is $92.79 per barrel by 8:08 qoq, which is $0.73 (0.78%) lower than the closing price of the previous session. As a result of trading on Tuesday, these contracts rose by $0.26 (0.3%) to $93.52 per barrel.
The price of futures for WTI oil for December in electronic trading on the New York Mercantile Exchange (NYMEX) is $84.84 per barrel by this time, which is $0.48 (0.56%) lower than the final value of the previous session. A day earlier, the contract rose in price by $0.74 (0.9%) to $85.32 per barrel.
The ICE-calculated index, which shows the dynamics of the dollar against six currencies (the euro, the Swiss franc, the yen, the Canadian dollar, the pound sterling and the Swedish krona), lost about 1% on the eve, which supported oil quotes.
In addition, the market on Tuesday reacted to statements by Saudi Energy Minister Prince Abdulaziz bin Salman that the lack of strategic reserves of raw materials and free mining capacity could become painful for the market in the coming months.
Meanwhile, the American Petroleum Institute (API) reported Tuesday night that U.S. inventories rose by 4.5 million barrels last week. Experts, on average, expected a more moderate growth, in the region of 200,000 barrels.
Official data from the Energy Information Administration of the US Department of Energy will be released on Wednesday at 17:30 qoq, and analysts polled by Trading Economics predict that the report will indicate an increase in oil inventories by 1.03 million barrels and a decrease in gasoline reserves by 0.8 million barrels.
Traders are evaluating both signals of weakening global economic growth and the prospects for a reduction in fuel supply on the world market. In particular, investors are waiting for details of the US-promoted plan to introduce a price ceiling for Russian oil against the backdrop of a full-scale war unleashed by the Russian Federation against Ukraine, writes Bloomberg.
The price of December futures for Brent on London’s ICE Futures is $93.25 per barrel by 8:15 ET on Tuesday, which is $0.01 (0.01%) lower than the closing price of the previous session. As a result of trading on Monday, these contracts fell by $0.24 (0.3%) to $93.26 per barrel.
The price of futures for WTI oil for December in the electronic trading of the New York Mercantile Exchange (NYMEX) rose by this time by $0.03 (0.04%), to $84.61 per barrel. By the close of previous trading, the value of these contracts fell by $0.47 (0.6%) to $84.58 per barrel.
Published the day before, statistical data from China, which is the world’s largest oil importer, were mixed. The growth of the country’s GDP in the third quarter exceeded forecasts, while the September increase in retail sales was the lowest in 4 months, and the increase in imports fell short of experts’ expectations.
In addition, reports of the introduction of quarantine restrictions in the major Chinese city of Guangzhou dampened risk appetite in global markets, including oil.
“It is possible that the risks of a recession, as well as a drop in demand in China, are exaggerated and already priced into the market,” said Steven Innes, managing partner of SPI Asset Management, quoted by Bloomberg. in response to the military aggression of the Russian Federation against Ukraine – IF) on the supply of Russian oil to the European Union in December – these are the main factors that will serve as catalysts for rising prices and lead to their rise to $100 per barrel by the end of the year.
Oil prices fall on Monday, despite rising energy demand in China.
The pressure on the market continues to be exerted by the strengthening of the dollar, as well as fears of a recession in the global economy as a result of the rapid tightening of monetary policy by world central banks, Bloomberg notes.
“The high volatility of the oil market will continue as we see both the risks of a recession and the possibility of a supply shortage,” said Zhaojin Futures Co. analyst. Gao Jian.
The cost of December futures for Brent on the London ICE Futures exchange by 8:15 Moscow time on Monday is $92.87 per barrel, which is $0.63 (0.67%) lower than the closing price of the previous session. As a result of trading on Friday, these contracts rose by $1.12 (1.2%) to $93.5 per barrel.
The price of futures for WTI oil for December in electronic trading on the New York Mercantile Exchange (NYMEX) fell by $0.6 (0.71%) by this time, to $84.45 per barrel. By the close of previous trading, the value of these contracts increased by $0.54 (0.6%) to $85.05 per barrel.
As a result of last week, Brent rose by 2%, WTI – by 0.5%.
Statistical data on the Chinese economy, published on Monday, showed a more significant than expected growth in the country’s GDP in the third quarter. The indicator increased by 3.9% in annual terms after rising by 0.4% in the previous quarter. The consensus forecast of experts polled by Trading Economics called for growth of 3.4%.
The growth rate of Chinese exports in September slowed down to 5.7% from 7.1% in August, while imports grew by 0.3%, the same as a month earlier.
At the same time, China’s oil imports increased to 9.83 million barrels per day, the highest since May, according to Bloomberg calculations based on data from the General Administration of Customs of the People’s Republic of China.
Oil prices are rising on Friday morning due to rumors about a possible easing of anti-COVID restrictions in China.
The price of December futures for Brent on the London ICE Futures exchange by 8:13 am CST is $92.90 per barrel, which is $0.42 (0.45%) higher than the closing price of the previous session. As a result of trading on Thursday, these contracts fell by 3 cents to $92.38 per barrel.
The price of futures for WTI oil for December in electronic trading on the New York Mercantile Exchange (NYMEX) is $84.98 per barrel by this time, which is $0.47 (0.56%) higher than the final value of the previous session. By the close of the last session, the contract fell 1 cent to $84.51 per barrel.
A positive factor for the oil market was the news about a possible easing of quarantine regulations for tourists in China. The quarantine period could be reduced to 7 days from the current 10, Bloomberg wrote.
Rumors of an easing of restrictive measures in China were perceived by investors as a signal of a potential curtailment of the policy of “zero tolerance” for the coronavirus, which in turn could spur economic growth and increase demand for fuel in the country, writes The Wall Street Journal.
“China was expected to increase oil imports, but there is no increase in spot market activity from the world’s second largest economy,” said StoneX Group analyst Harry Altham. “Such measures could revive the economy, suffering from anti-COVID restrictions, and become a lifeline for struggling air carriers.
Earlier, US President Joe Biden decided to release 15 million barrels from the strategic reserve (SPR) in December.
“Given that this is part of a previously announced large-scale release, the impact on the market is minimal. Such a measure is unlikely to offset the effect of OPEC+ supply cuts,” ING analyst Warren Patterson wrote.
