Oil Prices Fall Following U.S. Inventory Rise
19 July 2018 - 9:48PM
Dow Jones News
By Christopher Alessi
LONDON--Oil prices fell Thursday morning on the back of rising
U.S. petroleum stockpiles.
Brent crude, the global benchmark, was down 1.2% at $72.01 a
barrel on London's Intercontinental Exchange. On the New York
Mercantile Exchange, West Texas Intermediate futures were trading
down 1.1% at $68.00 a barrel.
On Wednesday, the U.S. Energy Information Administration said
crude oil inventories increased by 5.8 million barrels last week,
to reach 411.1 million barrels. Analysts surveyed by The Wall
Street Journal had forecast a decline in crude stockpiles
week-on-week.
The EIA also reported that U.S. crude production rose to a 11
million barrels a day--a record high, according to Tamas Varga, an
analyst at brokerage PVM Oil Associates Ltd.
However, the EIA said petroleum product stockpiles had fallen
last week, which helped bolster prices in afternoon trading
Wednesday.
"What is bullish in the report, apart from the unexpected draw
in gasoline stocks, is the demand data. Total product demand was up
1.4 million barrels a day last week at 21.3 million barrels a day,"
Mr. Vargas noted.
Oil prices have, overall, come under pressure over the past
week, with Brent coming down nearly $8 a barrel, amid concerns over
burgeoning global supply.
"On the supply side, production in Libya has staged a partial
comeback, a release from the U.S. Strategic Petroleum Reserve has
become a growing possibility, and the possibility has emerged that
the U.S. government introduces some waivers around the Iranian
sanctions," analysts at Morgan Stanley wrote in a note.
At the same time, Saudi Arabia and some other members of the
Organization of the Petroleum Exporting Countries have been rapidly
ramping up output after more than a year of holding back production
with partner producers like Russia.
Among refined products Thursday, Nymex reformulated gasoline
blendstock--the benchmark gasoline contract--was down 1.1% at $1.99
a gallon. ICE gasoil, a Benchmark for diesel, was up 0.3% at
$634.75 a metric ton.
Write to Christopher Alessi at christopher.alessi@wsj.com
(END) Dow Jones Newswires
July 19, 2018 07:33 ET (11:33 GMT)
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