78993
Oil Rebound Sets Stage for Another OPEC-Shale Clash
Oil Rebound Sets Stage for Another OPEC-Shale Clash

Oil Rebound Sets Stage for Another OPEC-Shale Clash

Oil Rebound Sets Stage for Another OPEC-Shale Clash

Oil continued its revival from the biggest crash in a generation, with prices set for a second annual gain after a year marked by hurricanes, Middle East conflict and the tussle between OPEC and US shale.
Futures are up more than 12% in 2017, having entered a bull market in September. In 2018, investors will watch whether rising prices trigger a new flood of US output, Bloomberg reported.
“The current highs are unsustainable in the short-to-medium term, with prices likely to head back below $60 once we get past January, but for now the season of goodwill appears to be in full swing,” said analysts led by Michael dei-Michei at consultants JBC Energy GmbH in Vienna.
West Texas Intermediate, the US benchmark, is now trading at the highest level since mid-2015, pushed above $60 a barrel by a severe cold snap in the northeastern US that spiked demand for heating fuel. Oil topped natural gas as the biggest source of electricity in New England on Thursday morning, after temperatures plunged below freezing.
US output has surged overall this year, hitting a 46-year high in October when producers pumped 9.6 million barrels a day, according to federal data. The US expects production to top 10 million barrels a day in the coming year.
For now, shale drillers are showing restraint, with the number of working rigs unchanged for the second week in a row, according to Baker Hughes data released on Friday. The rig count, now at 747, stayed relatively stable during the last quarter, even as oil strengthened.
At the same time, speculation is rising that American drillers will put more rigs to work next year as oil strengthens. That could undermine plans by the Organization of Petroleum Exporting Countries and other producers, including Russia, who have pledged to extend production curbs through the end of 2018 to wipe out a global glut.
"With that partially offsetting production cuts by OPEC and Russia, the market will have to get confirmation that global inventories will keep coming down," Gene McGillian, a market research manager at Tradition Energy in Stamford, Connecticut, said by telephone. "If we don’t see that pattern continue then, we could see a significant correction."
“The tug of war between OPEC and the US will continue to pressure oil from trading above $60 a barrel in 2018,” said Kim Kwangrae, a Seoul-based commodities analyst at Samsung Futures Inc. “Like we’ve seen this year, geopolitical risks will be the key factor going forward for oil to breach $60.”

 

Short URL : https://goo.gl/4WgZjM
  1. https://goo.gl/wKtez7
  • https://goo.gl/hnKXsY
  • https://goo.gl/YZyZ3s
  • https://goo.gl/H1FQ9G
  • https://goo.gl/QFbcMg

You can also read ...

679 tons of carbon dioxide will be prevented from entering the atmosphere during the project’s 20-year lifetime.
Solar power is becoming an increasingly important part of the...
India Will Lead International Oil Demand by 2035
Oil market participants and analysts have been closely...
Oil Markets Split
Oil markets were split on Tuesday, with US crude still...
Oil Producers to Mull  Long-Term Cooperation
OPEC and non-OPEC oil producers, including Russia, will...
Iran is currently drawing crude from West Karoun block at an unacceptable extraction rate of 5-6%.
Iran's Petroleum Engineering and Development Company has...
Gas Delivery to Power Plants Cuts Pollution, Raises Revenues
Supplying natural gas to power plants, instead of liquefied...
Iran Gasoline Consumption  at 80 ml/d in 1 Month
Data released by the National Iranian Oil Products...

Add new comment

Read our comment policy before posting your viewpoints

Trending

Googleplus