Business Extra Podcast: What's next for the oil price rally?

Apr 29, 2018, 00:51
Business Extra Podcast: What's next for the oil price rally?

Oil prices edged lower on Friday as the dollar rose, but Brent was still headed for a third week of gains amid supply concerns should the United States reimpose sanctions on Iran.

A rise in USA government borrowing costs to their highest since 2013 this week has tempered some investor appetite for risk, but analysts said Brent crude futures, the global benchmark, may yet rise towards new 2018 peaks above $75 a barrel.

But new reports of falling crude inventories in the U.S. and creeping concerns that President Donald Trump will slap sanctions on Iran propped prices back up. Under the agreement, Iran suspended its nuclear program in return for the lifting of sanctions.

U.S. crude oil inventories C-STK-T-EIA rose by 2.2 million barrels in the week to April 20, to 429.74 million barrels.

E. Coli outbreak tied to romaine lettuce gets worse
Forty-six people have been hospitalized, including 10 with kidney failure, which is an unusually high number of hospitalizations. If you already have store bought romaine lettuce in your fridge, the CDC said you're better off not eating and throwing it away.

Brent crude for June delivery rose 74 cents to end the session at $74.74 on the London-based ICE Futures Europe exchange.

Soaring U.S. output has made WTI crude around $6 per barrel cheaper than Brent and drawn exports to record highs over 2 million bpd. Total volume traded was less than 1% below the 100-day average. A slight suggestion that President Trump might accept a revised deal between the six Western powers who signed the original nuclear deal with Iran on Tuesday did halt the price rise, but it was temporary.

Such figures would usually weigh on prices, but the market appears to be much more focused on the possibility of new sanctions against Iran. That's an increase of more than a quarter since mid-2016.

"Geopolitical concerns in the Middle East, together with Venezuela's deteriorating macroeconomic situation, are supporting oil prices".

Southwest sends apology, $US5,000, to passengers on damaged jet
In March, an Arik flight from Lagos to Accra, Ghana, made an emergency landing after the pilot detected a smoke in the cabin. Jennifer Riordan, 43 and a mother of two, was sucked out of the broken window and pulled back inside by fellow passengers.

Dutch bank ING said "the wide discount for WTI to Brent saw exports rising 582,000 bpd week-on-week to a record high of 2.33-million bpd".

"All we're seeing is very strong pricing and the slight softening is primarily due to a stronger dollar", said Bjarne Schieldrop, SEB chief commodity analyst.

Additionally, traders expect a report on Friday by energy services firm Baker Hughes to show that USA producers increased the rig count.

Crude imports climbed 539,000 b/d last week to 8.469 million b/d, while refinery utilization rates averaged 90.8% for the week ending April 20, down 1.6%.

See Kyle Busch celebrate NASCAR race win with a gladiator sword
The Joe Gibbs Racing driver and 2015 series champion won his seventh career Cup race at Bristol, most among active drivers. Ryan Blaney was off to a strong start at Bristol but his race ended in a crash on Lap 117 of the Food City 500.

loading...
loading...
YOU MIGHT ALSO LIKE
popular