Oil Prices Edge Higher in Uncertain Market
Oil prices edge higher in an uncertain market as US crude futures rise 0.1% to $78.94 a barrel, despite a 2% drop for the week, due to production cuts by major oil producers and a mixed US economy.
Topics
Posted 8/24/2023, 5:37:00 PM
barrons.com
Relevant topic timeline:
Summary: Oil prices are expected to continue rising due to tightening in the physical market, with a projected deficit of 2MMbbls/d in the second half of 2023, and forecasts of Brent averaging $86/bbl over 3Q23 and $92/bbl over 4Q23, while the medium sour crude market tightens, and concerns remain over Russian oil supply risks and global demand.
Crude oil prices are expected to continue consolidating just above the 200-Day EMA, with the 50-Day EMA below it, leading to questions about the market; the possibility of breaking above the shooting star formed on Monday could allow for a move towards $85, while breaking below the moving averages could result in a drop to $75 due to noise from OPEC countries cutting production. The Brent markets also show signs of negativity but are supported by the 200-Day EMA and the 50-Day EMA, with potential to reach the $90 region; attention should also be given to the US dollar's influence on the market.
Crude oil prices rise as US inventories decline and concerns about US rate hikes and China's economic indicators persist.
The price of Brent crude oil hitting triple digits this year is debatable, with some experts believing it is unlikely due to macro factors and demand concerns, while others predict it could reach $100 per barrel if certain conditions are met, such as consistent OECD crude and product stock draws and OPEC adherence to production cuts.
Oil prices rose over 1% as the dollar strengthened ahead of a speech by the head of the U.S. Federal Reserve for clues on interest rates, with Brent crude reaching $84.29 a barrel and U.S. West Texas Intermediate crude at $79.92, while a strong dollar and recent inventory draws affected demand and supply.
Oil futures rose to a one-week high due to a surge in U.S. diesel prices, a decrease in oil rigs, and a fire at a Louisiana refinery, despite weak economic data and a stronger dollar.
Crude oil prices are trying to recover and show signs of support, with a "buy on the dips" attitude prevailing due to Saudi Arabia holding 1 million barrels per day out of the market, although supply concerns may arise despite a global slowdown.
Crude oil prices rose after the U.S. Energy Information Administration reported a larger-than-expected inventory decline of 10.6 million barrels for the week ending August 25.
A group of oil analysts and economists have raised their 2023 oil price forecasts, predicting Brent crude will average $82.45 a barrel and that Saudi Arabia is likely to extend its voluntary oil supply cut into October.
U.S. crude oil stocks have reached their lowest level this year and are expected to decrease further, leading to a tight crude oil market and a potential increase in global oil prices.
The price of WTI crude oil reached a new high for the year, hitting $85 per barrel, due to falling inventory levels and factors such as production cuts and a weakening dollar.
Oil prices jumped over 2.5% after OPEC+ members extended supply reductions, with Brent International topping $90 per barrel and West Texas Intermediate hovering above $87 per barrel, as Saudi Arabia announced an extension of its production cut and Russia reduced its exports. Despite slow recovery and increased production, crude futures have rallied more than 25% since late June, with experts predicting prices to continue rising unless a recession occurs. China's demand for petrochemicals has been dampened, but their mobility demand post-lockdowns has offset this.
Gold and silver prices are lower due to technical selling and a lack of fresh fundamental news, while rising crude oil prices have potential economic and marketplace effects.
Goldman Sachs predicts that oil prices could reach $107 per barrel next year if OPEC+ producers maintain their production cuts, although this is not their base-case scenario.
Crude oil prices in the US increased due to a 6.3 million barrel inventory draw, following a massive decline of 10.6 million barrels the previous week, bringing inventories to the lowest in eight months.
The extension of voluntary oil production cuts by Saudi Arabia and Russia has caused oil prices to surge above $90 a barrel, threatening an inflationary spike that could disrupt central banks' plans to wind down interest-rate hikes, particularly for the Bank of Canada.
Brent crude futures hover above $90 a barrel as investors await macroeconomic data that could indicate further interest rate hikes in Europe and the US.
The OPEC+ decision to cut production is putting inflationary pressure on the US and its allies, while China's encouragement of higher oil and gas prices may have negative economic consequences for the country. The short-term steady equilibrium price for Brent is projected to be around $80-85 per barrel, with a ceiling of $95 per barrel.
Oil prices are climbing towards $100 per barrel due to supply disruptions in Libya and expectations of a further U.S. inventory draw.
Oil prices edged higher on Thursday as markets refocused on expectations of tight crude supply for the rest of 2023, following the extension of oil output cuts by Saudi Arabia and Russia and the International Energy Agency's forecast of a substantial market deficit through the fourth quarter.
Oil prices surged on Thursday, with U.S. crude surpassing $90 a barrel, as the possibility of a tighter supply increased, driven by extended output cuts from Saudi Arabia and Russia.
US crude oil prices have surged and the futures strip has moved into a sharp backwardation as inventories have drained away from the NYMEX delivery point at Cushing in Oklahoma, but this may be exaggerating the tightness of supplies across the rest of the country and the world.
Oil prices continue to rise as OPEC+ supply cuts tighten the market, with Brent crude surpassing $94 a barrel and speculators increasing bullish wagers on Brent and West Texas Intermediate, leading to concerns about inflationary pressures.
Gasoline prices are rising due to oil supply cuts in Saudi Arabia and Russia, as well as flooding in Libya, but some experts believe that increasing oil prices will not have a significant impact on the US economy and do not expect them to rise much higher in the next year or two due to factors such as increased US oil production, slow global economic growth, and the green energy transition. However, high oil prices can lead to higher inflation, potential recession, and could influence the Federal Reserve to raise interest rates, but the impact may not be as severe as in the past, and some experts recommend investing in the energy transition and adopting a more defensive investment strategy.
Some grades of crude oil, such as Nigerian crude Qua Iboe and Malaysian crude Tapis, are already trading above $100 a barrel, highlighting expectations of tight supply as oil prices continue to rise due to concerns of a supply deficit in the fourth quarter.
Global oil prices continue to soar, with Brent crude nearing $95 per barrel and some crude grades surpassing $100, driven by tight supply, excess demand, and production cut extensions by Saudi Arabia and Russia.
Saudi Arabia's energy minister, Prince Abdulaziz bin Salman, stated that the decision to extend crude oil supply cuts with Russia is not about raising prices, but rather about making the right decision at the appropriate time based on data and clarity, as oil prices near $100 per barrel and analysts predict further increases.
Crude oil prices reach new highs despite concerns about China's economy and tightened monetary policies, with the oil market structure indicating strong demand and potential support for higher prices.
Chevron CEO says the economy can handle rising oil prices, with prices on track to reach $100 per barrel due to supply constraints and a resilient global economy.
World markets are cautious ahead of central bank decisions and concerned about inflation signals amidst rising oil prices, as crude oil reaches its highest levels of the year due to supply cuts from Saudi Arabia and Russia, while US production also falls.
Oil prices reach a 3-month high as OPEC maintains tight supply. Gas prices in the US rise, posing a threat to efforts against inflation.
Goldman Sachs predicts that crude oil prices could reach $100 a barrel, posing a risk to global economic growth and complicating central bankers' efforts to control inflation, which could impact interest rate policies and further increase gasoline prices.
Oil prices dipped after reaching a 10-month high due to profit taking and anticipation of a Fed decision on interest rates, but analysts remain bullish on the future of oil.
Crude oil prices rose as inventories declined and demand from Asia and Europe decreased, threatening higher gas prices in the US and potentially impacting the Federal Reserve's interest rate decisions.
Oil prices reaching $95 per barrel, the highest level since November 2022, pose a setback for Rishi Sunak's goal of halving inflation, with analysts predicting a 7.1% rise in consumer prices in August due to petrol price increases, adding to inflationary pressures and potentially influencing the Bank of England's interest rate decision.
The recent global supply concerns caused by Russia's fuel export ban are driving up oil prices, counteracting the demand fears driven by macroeconomic headwinds and high interest rates.