Oil prices steady after last week's gains, look to US-China talks

Daniel Fowler
November 18, 2019

WTI and Brent crude prices have increased 27.11 percent and 17.66 percent, respectively, so far this year, falling from their peak levels in April when the growth of WTI hit over 40 percent, and Brent crude over 30 percent. U.S. Crude inventory levels rose over 2M barrels in the earlier week, constantly building up Crude inventory level amid weakening of demand around the globe weighed on the prices.

The IEA said it expects non-OPEC supply growth to rise to 2.3 million barrels a day next year, up from its previous estimate of 2.2 million barrels a day.

USA energy firms this week reduced the number of oil rigs operating for a fourth week in a row. Baker Hughes on Friday reported that the number of active United States rigs drilling for oil fell by 10 to 674 last week.

Sluggish refinery activity in the first three quarters has caused crude oil demand to fall in 2019 for the first time since 2009, the IEA said, but refining is set to rebound sharply in the fourth quarter and in 2020.

Brent crude still continued to hover in a narrow range most of the year, trading sideways at around $60 per barrel both prior to and after the Sept.14 attacks on Saudi Aramco oil facilities. The slower economic growth of the world will lead to less demand for oil, which in turn would put downward pressure on oil prices.

Saudi Arabia's crude oil exports fall to 6.67 million barrels per day in September.

Police say at least 9 shot in shooting at Fresno backyard party
Nine people were shot at a family gathering in southeast Fresno, Calif ., on Sunday, Nov. 17, 2019. The shooting took place about a half-mile (0.8 kilometers) from the city's airport.

Later this week, investors will be paying close attention to the Energy Information Administration's (EIA) weekly oil market report, which last week revealed that crude oil production in the USA rose to a record high of 12.8 million bpd.

The major influence was the renewed speculation that the U.S. and China may be about to do a trade deal - or at least the first part of a deal.

The Organisation of the Petroleum Exporting Countries and its allies face stiff competition in 2020, the International Energy Agency has said, adding urgency to the oil producer group's policy meeting next month.

In its report, OPEC mentioned some positive elements, including signs of improving trade relations between the United States and China, but it also warned that trade-related issues and the associated uncertainties remain.

However, the IEA neglected to report that the U.S. oil and gas rig count continued to fall for the 12th time in the past 13 weeks.

Other reports by

Discuss This Article

FOLLOW OUR NEWSPAPER