Thursday, December 29, 2016

Oil prices slip as US crude inventories rise by 614,000 barrels

Oil prices slipped on Thursday after official government data showed U.S. crude stockpiles rose last week more than analysts expected, while gasoline stocks and distillate inventories fell.

Crude stocks rose by 614,000 barrels in the week to Dec. 23, as refineries cut output crude imports fell, the Energy Information Administration reported.

Analysts polled by Reuters ahead of the report had forecast on average that inventories would decline 2.1 million barrels.

Data released by industry group the American Petroleum Institute (API) late on Wednesday showed a 4.2 million barrel increase in U.S. crude stocks in the week to Dec. 23.

Gasoline stocks fell by 1.6 million barrels, compared with analysts' expectations in a Reuters poll for a 1.3 million-barrel gain.

Distillate stockpiles, which include diesel and heating oil, fell by 1.9 million barrels, versus expectations for a 1.8 million-barrel increase, the EIA data showed.

U.S. light crude was down 25 cents at $53.81 by 11:12 a.m. ET (1612 GMT), while North Sea Brent crude was up 8 cents at $56.30 a barrel.

Traded volumes were thin with many investors away for year-end holidays, although the expiry of the front-month February ICE Brent contract on Thursday could generate some activity.
Both crude oil benchmarks have made big gains this month since OPEC and other producers agreed to curb production in an attempt to balance an oversupplied fuel market. 

"The market is in good shape although it might fail to make significant advances this year," said analyst Tamas Varga at London brokerage PVM Oil Associates. "If that is the case the uptrend should continue in early January." 

"Either way, the odds are still on higher numbers." 

A committee of the Organization of the Petroleum Exporting Countries and non-OPEC producers will meet in Vienna on Jan. 21-22 to discuss compliance with the production agreement, Kuwaiti oil minister Essam Al-Marzouq told state news agency KUNA.

"Brent will be ... positively impacted by the OPEC and non-OPEC cuts should the agreed reductions be largely adhered to over the next six months," said Philips Futures' investment analyst Jonathan Chan. 

— CNBC's Tom DiChristopher contributed to this report.

No comments:

Post a Comment