Published: Sat, July 13, 2019
Finance | By Loren Pratt

Oil prices jump 4.5% on US crude stocks draw

Oil prices jump 4.5% on US crude stocks draw

Oil prices rose on Friday as United States oil producers in the Gulf of Mexico cut more than half their output in the face of a tropical storm and as tensions continued in West Asia.

Fifteen production platforms and four rigs were evacuated in the north central Gulf of Mexico, according to a US regulator as oil firms moved workers to safety ahead of a storm expected to become a hurricane by Friday.

Tensions around Iran's nuclear program and recent incidents involving oil tankers in the Gulf have also supported prices. A fourth weekly draw in American stockpiles and signs that the Federal Reserve is prepared to cut interest rates also supported prices. Asian stocks climbed and the dollar weakened following Powell's comments.

U.S. West Texas Intermediate crude oil futures dipped 23 cents, or 0.4%, to settle at $60.20/Bbl, after hitting their highest price since May 23, at $60.94/Bbl.

In light of the uncertainties affecting the global oil market and in an effort to avoid a destabilising build-up in oil inventories, the report indicated that OPEC and non-OPEC countries participating in the Declaration of Cooperation agreed to extend voluntary production adjustments until 31 March 2020, reaffirming their continued commitment to promote and enhance oil market stability The OECD is forecast to grow by 0.09 mb/d next year, with only OECD Americas showing positive growth, while OECD Europe and Asia Pacific are anticipated to continue to decline.

"Imports down, exports likely up and refinery utilisation at yearly highs", he said. The contract closed on the ideal stage since Might 22 on Wednesday.

Brent crude futures fell 39 cents, to $66.61 a barrel. The global benchmark crude traded at a US$6.58 premium to WTI for the same month. Royal Dutch Shell Plc and BP trust additionally evacuated workers.

Data released by Energy Information Administration (EIA) Wednesday morning showed US crude stockpiles fell by 9.5 million barrels in the week ended July 5, almost five times the expected drop.

In June the members of the organization extracted 29.83 million barrels per day, but the document estimates that by 2020 it will only have to supply 29.27 million.

The situation in the Middle East remained tense.

According to the British government, three Iranian vessels tried to block the passage of a British ship run by BP through the Strait of Hormuz. That came after Iran's military vowed to retaliate against the U.K.'s seizure of a tanker loaded with Iran's crude off the coast of Gibraltar last week.

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