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Yahoo
3 days ago
- Business
- Yahoo
Oil finishes down on possible OPEC+ output hike
By Erwin Seba HOUSTON (Reuters) -U.S. crude futures fell on Friday as traders expected OPEC+ would decide on Saturday to boost oil output for July beyond previous forecasts. Brent crude futures settled down 25 cents, or 0.39%, at $63.90 a barrel. U.S. West Texas Intermediate crude finished down 15 cents, or 0.25%, at $60.79 a barrel, having earlier dropped more than $1 a barrel. The Brent July futures contract is due to expire on Friday. The more liquid August contract was down 71 cents, or 1.12%, at $62.64 a barrel. At these levels, the front-month benchmark contracts were headed for weekly losses over 1%. Prices dipped into negative territory after Reuters reported that OPEC+ may discuss an increase in July output larger than the 411,000 barrels per day (bpd) rise that the group decided on for May and June. "What OPEC+ is planning doesn't look particularly supportive for the oil market," said Matt Smith, Kpler's lead analyst for the Americas. The potential OPEC+ output hike comes as the global surplus has widened to 2.2 million bpd, likely necessitating a price adjustment to prompt a supply-side response and restore balance, said JPMorgan analysts in a note, adding that they expected prices to remain within the current range before easing into the high $50s by year-end. Phil Flynn, a senior analyst with Price Futures Group, said an online post on Truth Social by U.S. President Donald Trump that seemed to threaten more changes in tariff levels for Chinese imports also put pressure on crude prices. "Trump's Truth Social message on China failing to observe a truce on tariffs also combined with the Reuters headline to push prices down," Flynn said. Trump's tariffs were expected to remain in effect after a federal appeals court temporarily reinstated them on Thursday, reversing a trade court's decision a day earlier to put an immediate block on the sweeping duties. U.S. energy firms this week cut the number of oil and natural gas rigs operating for a fifth week in a row to the lowest since November 2021, energy services firm Baker Hughes said in its closely followed report on Friday. It was the first time since September 2023 that the number of rigs declined for five straight weeks. Baker Hughes said this week's decline put the total count down by 37 rigs, or 6%, from this time last year. Oil rigs fell by four to 461 this week, their lowest since November 2021, the company said. Gas rigs rose by one to 99.
Yahoo
14-05-2025
- Business
- Yahoo
Crude oil climbs more than $1.60 a barrel on tariff cuts, economic outlook
By Erwin Seba HOUSTON (Reuters) - Crude oil futures climbed more than $1.60 a barrel on Tuesday, lifted by a temporary cut in U.S.-China tariffs and a better-than-expected inflation report. Brent crude futures settled at $66.63 a barrel, up $1.67, or 2.57%. U.S. West Texas Intermediate (WTI) crude finished at $63.67, up $1.72 or 2.78%. The two benchmarks rose by about 4% or more in the previous session after the U.S. and China agreed on sharp reductions to their import tariffs for at least 90 days, which also boosted stocks on Wall Street and the dollar. "We didn't participate as much as other markets did yesterday in the China boom, so we're catching up today," said John Kilduff, a partner with Again Capital LLC. "Also the data this morning gives the Fed room to potentially begin making some moves." The U.S. Labor Department reported on Tuesday that the Consumer Price Index rose 2.3% in the 12 months through April, the smallest year-over-year gain in four years, leading Wall Street firms like JPMorgan Chase and Barclays to cut their forecasts of a U.S. recession in the coming months. The tamer inflation reading will likely be greeted with some relief by the Federal Reserve, which has kept its benchmark interest rate unchanged since last cutting it in December. The U.S. central bank has paused its rate cuts amid concerns that the trade war could reignite inflation. "All the numbers are bullish today," said Phil Flynn, senior analyst with Price Futures Group. "The inflation number, the economic data are very supportive." The Organization of the Petroleum Exporting Countries and its allies, a group called OPEC+, are planning to boost oil exports in May and June, which is seen as possibly limiting oil's upside. OPEC has raised oil output by more than previously expected since April, with its May output likely to increase by 411,000 barrels per day. Meanwhile, sources told Reuters that Saudi Arabia's crude oil supply to China will hold steady in June after hitting its highest level in more than a year in the previous month after an OPEC+ decision to increase output. The kingdom is the second-largest crude supplier to China behind Russia. Elsewhere, signs broadly point to demand for refined fuel remaining strong. "Despite the deteriorating outlook for crude demand, positive signals from the fuel markets cannot be overlooked," JPMorgan analysts said in a note. "Although international crude prices have declined by 22% since their peak on January 15, both refined product prices and refining margins have remained stable." Reduced refining capacity - mostly in the U.S. and Europe - is tightening gasoline and diesel balances, increasing reliance on imports and raising susceptibility to price spikes during maintenance and unplanned outages, they added.
Yahoo
29-04-2025
- Business
- Yahoo
Brent crude oil prices drop on demand fears
By Erwin Seba HOUSTON (Reuters) -Brent crude oil prices fell more than $1 a barrel on Monday morning as economic worries from the U.S.-China trade war were pressuring demand. Brent crude futures settled at $65.86 a barrel, down $1.01, or 1.51%. U.S. West Texas Intermediate crude finished at $62.05 a barrel, down 97 cents or 1.545%. Brent futures rose marginally in the previous two sessions, but finished last Friday with a weekly loss of more than 1%. The U.S.-China trade war is dominating investor sentiment in moving oil prices, said analyst John Evans of brokerage PVM, superseding nuclear talks between the U.S. and Iran and discord within the OPEC+ coalition. "This wait-and-see attitude coming out of the U.S.-China talks is leaving a bad taste in peoples' mouths," said Gary Cunningham, director of market research for Tradition Energy. "If the talks go bad, you could see a drop in demand for oil from China." Markets have been rocked by conflicting signals from U.S. President Donald Trump and Beijing over what progress was being made to de-escalate a trade war that could sap global growth. In the latest comment from Washington, U.S. Treasury Secretary Scott Bessent on Sunday did not back Trump's assertion that negotiations with China were underway. Earlier, Beijing denied any talks were taking place. "A lot of the feeling in the market is how is it going to be playing out in the next 24 to 48 hours?" said Phil Flynn, senior analyst with Price Futures Group. "Are we going to be bombing Iran? Is China going to be buying more crude?" Some members of the Organization of the Petroleum Exporting Countries and their allies, known as OPEC+, are expected to suggest that the group accelerate oil output hikes for a second consecutive month when they meet on May 5. "Sentiment has turned more bearish since our forecast last month with OPEC+'s more aggressive unwind – and accompanying doubts about unity within the cartel – the key change," said BNP Paribas analyst Aldo Spanjer in a note. BNP Paribas expects Brent in the high $60s per barrel in the second quarter of this year, the note said. Meanwhile, Iranian Foreign Minister Abbas Araqchi said he remained "extremely cautious" about the success of the negotiations, as nuclear talks between Iran and the United States in Oman continue this week. In Iran, a powerful explosion at its biggest port of Bandar Abbas has killed at least 40, with more than 1,200 people injured, state media reported on Sunday. Sign in to access your portfolio
Yahoo
14-02-2025
- Business
- Yahoo
Oil settles flat, pares early losses as tariffs delayed
By Erwin Seba HOUSTON (Reuters) -Oil prices settled flat on Thursday, paring early losses of more than 1% as U.S. tariff announcements were delayed until at least April, feeding hope that the world could avoid a trade war that would pressure economies and energy demand. Brent crude futures settled at $75.02 a barrel, down 16 cents, or 0.21%. U.S. West Texas Intermediate crude (WTI) finished down 8 cents, or 0.11%, at $71.29 a barrel. Prices had tumbled earlier as a potential peace deal between Russia and Ukraine kept traders concerned that an end of sanctions on Moscow could boost global energy supplies. U.S. President Donald Trump ordered commerce and economics officials to study reciprocal tariffs against countries that place tariffs on U.S. goods. Their recommendations are not due until April 1, allowing more time for negotiations with trading partners, market participants said. "We saw a big recovery in prices on tariffs not going into effect until April," said Phil Flynn, senior analyst with Price Futures Group. "That will allow time for negotiation." On Wednesday, Brent and WTI fell more than 2% after Trump said Russian President Vladimir Putin and Ukrainian President Volodymyr Zelenskiy expressed a desire for peace in separate phone calls with him. Trump ordered U.S. officials to begin talks on ending the war in Ukraine. The oil price decline over the past 24 hours looks to be driven by a change from worries about tight supplies to concern about sufficient supply, said UBS analyst Giovanni Staunovo, adding that some expect an increase in Russian energy exports. Russian oil exports could be sustained if workarounds to the latest U.S. sanctions package are found, after Russian crude production rose slightly last month, the International Energy Agency (IEA) said in its latest oil market report. The Ukraine news and Wednesday's U.S. oil inventories data offset higher U.S. inflation numbers that could drive the Federal Reserve to take a cautious approach to interest rate cuts in 2025, said PVM analyst John Evans. Russia is the world's third-largest oil producer and sanctions imposed on its crude exports after its invasion of Ukraine nearly three years ago have supported higher prices. ANZ analysts said on Thursday that oil prices declined on news of the potential peace talks because of "optimism that risks to crude oil supplies would ease", pointing to the U.S. and EU sanctions. A build in crude oil inventories in the United States, the world's biggest crude consumer, also weighed on the market. U.S. crude stocks rose more than expected last week, data from the Energy Information Administration (EIA) showed on Wednesday.
Yahoo
30-01-2025
- Business
- Yahoo
US tariff threat limits oil prices
By Erwin Seba HOUSTON (Reuters) -Oil prices edged up on Thursday, held in check by threatened U.S. tariffs on Canadian and Mexican crude imports that could take effect this weekend. Brent crude futures settled 29 cents, or 0.4%, higher at $76.87 a barrel. U.S. crude futures finished at $72.73 a barrel, up 11 cents, or 0.2% higher than Wednesday, when they settled at their lowest level this year so far. "We're getting close to the deadline and people are getting nervous," said Phil Flynn, senior analyst with Price Futures Group. U.S. President Donald Trump has threatened to impose a 25% tariff as early as Saturday on Canadian and Mexican exports to the United States if those two countries do not end shipments of fentanyl across U.S. borders. The White House on Tuesday reaffirmed Trump's plan to impose the tariffs, while on Wednesday, the president's nominee to run the Commerce Department said the two countries can avoid this if they act swiftly to close their borders to fentanyl. IG market analyst Tony Sycamore, however, said traders had already priced in Trump's tariffs: "(this is) a major reason why crude oil is trading where it is." Winter storms hit U.S. demand last week, with crude oil stockpiles in the U.S. rising by 3.5 million barrels as refiners cut production. Analysts had expected a 3.2 million-barrel build, according to a Reuters poll. On the supply side, the latest U.S. sanctions on Moscow are squeezing crude oil exports from Russia's western ports, which are set to fall 8% in February from the January plan as Moscow boosts refining, according to traders and Reuters calculations. Investors are also looking ahead to a meeting by the Organization of the Petroleum Exporting Countries and its allies including Russia, together called OPEC+, scheduled for Feb. 3. The group is set to discuss Trump's efforts to raise U.S. oil production and take a joint stance on the matter, Kazakhstan said on Wednesday. Trump has called on OPEC and its leading member, Saudi Arabia, to lower oil prices, saying doing so would end the conflict in Ukraine. He has also set up an agenda of maximizing oil and gas output in the U.S., already the world's largest producer and at record highs. However, analysts believe a price war between the U.S. and OPEC+ is unlikely as it may hurt both. "A price war with the U.S. would involve OPEC+ producers maximising their output to undercut prices and drive shale production into decline," analysts at BMI, a Fitch Group division, said in a note. Sign in to access your portfolio
