14514
Brent Rises Towards $59
Energy

Brent Rises Towards $59

Brent crude rose towards $59 a barrel on Monday as a slowdown in US drilling continued to support prices, offsetting a drop in Chinese oil imports.
Front-month Brent futures LCOc1 were up 93 cents at $58.80 a barrel by 1336 GMT, having earlier touched $59.54. US crude CLc1 was up $1.10 cents at $52.54 a barrel, after hitting $53.10.
The number of rigs drilling for oil in the United States fell by 42 last week to 760, the largest decline in a month, oil services firm Baker Hughes said in its closely watched survey on Friday.
“The US rig count once again focused people’s minds on the imminent reduction of production,” said Ole Hansen, head of commodity strategy at Saxo Bank.
“The market is choosing to not focus on the ample supply we have at the moment.”
Prices jumped by more than a dollar between 0715 GMT and 0810 GMT on Monday before dropping back under $59. Analysts said this was likely due to traders covering short positions.
Gains were capped by bearish news from top importer China, which imported 6.3 million barrels per day (bpd) in March, 5.2 percent down on February.
Speculators in Brent futures and options raised net long positions to the highest level since July, 2014 in the week to April 7, data from InterContinental Exchange showed.
This followed a rise in net long positions of US crude futures and options by 52 million barrels, their biggest weekly rise since 2011.
Reuters data shows open interest in WTI strike options for $60, $70, $80 and $90 per barrel on NYMEX has risen steadily since January, showing many traders are betting on rising prices. Volumes for $100-a-barrel options have risen by almost 20 percent.
But analysts at Germany’s Commerzbank were unconvinced by the investors’ bets.
“We believe the optimism among investors vis-a-vis oil is exaggerated,” they said in a note on Monday.
“This has given rise to considerable correction potential which could lead at any time to a sharp fall in prices.”
While many traders speculate that prices may not fall much further, analysts said a big rally was also unlikely.
“Although there are tentative signs of demand improving and rig counts fell to the lowest level since 2010, an ongoing global market surplus – driven by swelling US inventories and Saudi Arabian output to record high levels – should limit any potential rally,” ANZ said in a note.

 

Short URL : http://goo.gl/HUHJj2

You can also read ...

Offshore drilling is expensive in a time of relatively low oil prices.
The US administration on Friday said it would offer the...
India to Increase Oil Imports From Iran
In April through January, the first 10 months of this fiscal...
Egypt to Import LNG   From France
Egyptian Natural Gas Holding Company has arranged for the...
UAE Committed to OPEC Output Reduction Deal
The UAE will remain committed to the global oil output...
SP Phase 13 Ready to Deliver Sweet Gas
The first gas sweetening train in Phase 13 of South Pars Gas...
The national gas network accounts for providing 70% of the country's energy.
In line with efforts to deliver natural gas to far-flung...
NPC Subsidiary, Foreign Firms in Scientific Coop.
The Petrochemical Research and Technology Company of Iran...

Trending

Googleplus