59.9 F
Fort Worth
Wednesday, November 25, 2020
Energy Oil trades near $54 as OPEC targets 100 percent deal compliance
Energy Oil trades near $54 as OPEC targets 100 percent deal compliance

Oil trades near $54 as OPEC targets 100 percent deal compliance

Other News

Closing prices for crude oil, gold and other commodities

The Associated Press Benchmark U.S. crude oil for September delivery rose 31 cents to settle at $41.60 a barrel Monday. Brent crude oil for...

Trump to discuss energy, tour oil rig, raise money in Texas

By DARLENE SUPERVILLE Associated PressWASHINGTON (AP) — President Donald Trump will shift his focus to American energy dominance during a stop in Texas later...

Basic Energy Services makes organizational changes

Fort Worth-based Basic Energy Services, Inc. (OTCQX: BASX) in late May announced the implementation of changes to the organizational structure of the company, reducing...

Texas oil producers were cutting output before Railroad Commission chose not to, Commissioner Christi Craddick says

By Cassandra PollockMay 12, 2020 Texas Railroad Commissioner Christi Craddick on Tuesday doubled down on the agency’s recent decision to not cut oil production and...

Oil traded near $54 a barrel after earlier rising to the highest level in seven weeks as OPEC’s top official said the group intends to achieve full compliance with supply cuts.

Futures rose as much as 2.4 percent in New York. The Organization of Petroleum Exporting Countries is confident members will continue to cut production and reduce global stockpiles, said Secretary-General Mohammad Barkindo. Russia plans to reach its pledged output cuts by the end of April, RIA Novosti reported, citing Russia Energy Minister Alexander Novak. Brent will average $55 this quarter, Citigroup said in a note, an increase of $5 from its previous forecast.

Oil has held above $50 a barrel since OPEC and 11 other nations started trimming supply to ease a global glut. The exporters group implemented about 90 percent of the pledged cuts last month and Goldman Sachs predicts the market will shift into deficit in the first half, although U.S. crude stockpiles have increased to the highest level in more than three decades.

“OPEC and new fund length are adding a bid to the market, but the current level of supply is massive and it’s limiting rallies to a narrow range,” Clayton Rogers, an energy derivative broker at SCS Commodities Corp. in Jersey City, New Jersey, said by message.

Hedge funds boosted their net-long position on WTI, or the difference between bets on a price increase and wagers on a decline, by 8.6 percent in the week ended Feb. 14, U.S. Commodity Futures Trading Commission data showed Friday. It was the fifth time this year that they’ve upped their bullish stance, and the third they took it to a record.

West Texas Intermediate for March delivery, which expires Tuesday, rose from Friday by 82 cents to $54.22 a barrel at 11:03 a.m. on the New York Mercantile Exchange after earlier climbing to $54.68, the highest intraday level since Jan. 3. WTI also rose above its upper Bollinger band for the first time since early January.

The more-active April WTI contract climbed 79 cents to $54.57. Transactions on Monday will be booked Tuesday for settlement purposes because of the U.S. Presidents Day holiday.

Brent for April settlement gained 66 cents to $56.84 a barrel on the London-based ICE Futures Europe exchange. The global benchmark crude traded at a premium of $2.27 to April WTI.

“Oil prices are not likely to stray far from their current $53 to $58 range in the near term,” Ed Morse, global head of commodities research at Citigroup, wrote in a note Tuesday. “Record investor net length and bearish inventory data will likely cap prices until more tangible evidence of a tighter market emerges.”

The effects of high OPEC compliance with its historic output deal have yet to be realized and should support prices into the second quarter, Citigroup said. Compliance may even increase if Iraq’s March exports match the planned 600,000 barrel a day month-on-month cut indicated by loading programs, it said.

OPEC data on compliance with cuts so far are “very encouraging,” Barkindo said in a Bloomberg television interview in London. It’s premature to say whether OPEC should extends its supply deal beyond six months, or deepen the cuts, and the pace of the decline in global oil inventories will determine OPEC’s next move, he said.

“The oil market appears to maintain its confidence in producer supply restraint efforts for now as evidenced by the commitment of trader data that showed managed money continuing to increase their net long exposure,” Harry Tchilinguirian, head of commodity markets strategy at BNP Paribas in London, said by message. But, given their overstretched position, progress has been relatively modest and any disappointment around producer action could trigger a correction, he said.

In other oil-market news:

– OPEC boosted oil exports in the first two weeks of February, according to tanker tracker Petro-Logistics, a sign the group could be slipping back after record compliance in its first month of output cuts.

– The U.S. Oil Fund saw an $85 million outflow last week, the largest weekly outflow since late January, data shows.

– Bank of America Merrill Lynch cuts its Brent average forecast to $50-$70 a barrel through 2022 from $55-$75 a barrel, a note shows.

– Norway’s Troll crude will be included alongside existing grades that make up the Dated Brent benchmark — Brent, Forties, Oseberg and Ekofisk, according to price assessor S&P Global Platts.

– Russia overtook Saudi Arabia as the world’s largest oil producer in December before both nations started reducing output on Jan. 1 as part of a deal to stabilize the market.

Bloomberg’s Alex Longley and Ben Sharples contributed.


Oh hi there 👋
It’s nice to meet you.

Sign up to receive awesome content in your inbox.

We don’t spam! Read our privacy policy for more info.

Latest News

Tarrant County DA’s office changing how it handles misdemeanor marijuna cases

The Tarrant County Criminal District Attorney’s Office is changing how it handles misdemeanor marijuana cases. The Tarrant County  Criminal District Attorney’s Office on Monday, Nov....

Arlington selects new police chief from Baltimore department

Col. Al Jones, a 25-year veteran of the Baltimore County Police Department, has been appointed the new police chief of the the City of...

Fort Worth firm acquired by Abilene-based Petrosmith

Abilene-based Petrosmith, a leading provider of production equipment and oilfield tubular goods, has acquired the assets of Wellflex Energy Solutions LLC, an engineering, procurement...

GM flips to California’s side in pollution fight with Trump

DETROIT (AP) — General Motors says it will no longer support the Trump administration in legal efforts to end California’s right to set its...

Fort Worth out of running for Space Command HQ, San Antonio still in

A Texas city could still host the U.S. Space Command headquarters, but it’s not going to be Fort Worth. The U.S. Air Force has narrowed...