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CNBC
a day ago
- Business
- CNBC
Kilduff: Supply from OPEC+ and demand from China are the biggest factors for the oil markets
Again Capital's John Kilduff discusses the potential downside risks for oil prices, including OPEC+ increasing output again, fresh sanctions on Russian crude, and a potential Iran nuclear deal leading to more Iranian oil hitting the market.
The Star
23-05-2025
- Business
- The Star
Oil falls on potential further hike in Opec+ output
HOUSTON: Oil prices slipped on Thursday as investors weighed a report that Opec+ is discussing a production increase for July, stoking concerns that global supply could outpace demand growth. Brent futures fell 66 cents, or 1.02%, to US$64.25 a barrel by 12:31 p.m. EDT. US West Texas Intermediate crude was down 51 cents, or 0.83%, at US$61.06. The Organization of the Petroleum Exporting Countries and its allies, known collectively as Opec+, are discussing whether to make another large output increase at their meeting on June 1, Bloomberg News reported. An increase of 411,000 barrels per day for July is among the options under discussion, though no final agreement has been reached, the report said, citing delegates. "The Opec+ speculation is the biggest factor today," said John Kilduff, partner at Again Capital in New York. "This Opec+ decision is going to be pretty weighty, and it is not helping that Kazakhstan did not come through last month," he added. Kazakhstan's oil production has risen by 2% in May, an industry source said on Tuesday. Reuters previously reported that the group planned to accelerate output increases and could bring back as much as 2.2 million bpd by November. Opec+ has been in the process of unwinding production cuts, with additions to the market in May and June. "We're seeing the market reacting to evidence that Opec is letting go of a strategy to defend price in favour of market share," said Harry Tchiliguirian at Onyx Capital Group. "It's a bit like taking off a Band-Aid; you do it in one fell swoop." RBC Capital analyst Helima Croft said in a note on Wednesday that a 411,000-bpd increase from July is the "most likely outcome" from the meeting, primarily from Saudi Arabia. "A key question will be whether the voluntary cut will be fully drawn down before the leaves turn brown in many parts of the world, in line with the original taper schedule," she said. Prices were already lower in the session after Energy Information Administration data released on Wednesday showed US crude and fuel inventories showed surprise stock builds last week as crude imports hit a six-week high and gasoline and distillate demand slipped. Crude inventories rose by 1.3 million barrels to 443.2 million barrels in the week ended May 16, the EIA said. Analysts in a Reuters poll had expected a drawdown of 1.3 million barrels. The EIA's surprise stock builds will exert downward pressure on prices, particularly on WTI, said Emril Jamil at LSEG Oil Research, adding that this could further encourage more US exports to Europe and Asia. Curbing losses on Thursday, US oil company Chevron's license to operate in Venezuela will expire on May 27, US Secretary of State Marco Rubio said in a post on his personal X account late on Wednesday. "This statement by Rubio could be a game changer. But these deadlines have been extended in the past, so maybe the market is just not convinced yet," said Phil Flynn, senior analyst with Price Futures Group. — Reuters
Business Times
22-05-2025
- Business
- Business Times
Oil prices settle down on potential further increase in Opec+ output
[HOUSTON] Oil prices settled lower on Thursday as investors weighed a report that Opec+ is discussing a production increase for July, stoking concerns that global supply could outpace demand growth. Brent futures settled down 47 cents, or 0.72 per cent, to US$64.44 a barrel. US West Texas Intermediate crude settled down 37 cents, or 0.6 per cent, at US$61.20. The Organization of the Petroleum Exporting Countries and its allies, known collectively as Opec+, are discussing whether to make another large output increase at their meeting on June 1, Bloomberg News reported. An increase of 411,000 barrels per day for July is among the options under discussion, though no final agreement has been reached, the report said, citing delegates. 'The Opec+ speculation is the biggest factor today,' said John Kilduff, partner at Again Capital in New York. 'This Opec+ decision is going to be pretty weighty, and it is not helping that Kazakhstan did not come through last month,' he added. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up Kazakhstan's oil production has risen by 2 per cent in May, an industry source said on Tuesday. Output increases Reuters previously reported that the group planned to accelerate output increases and could bring back as much as 2.2 million bpd by November. Opec+ has been in the process of unwinding production cuts, with additions to the market in May and June. 'We're seeing the market reacting to evidence that Opec is letting go of a strategy to defend price in favour of market share,' said Harry Tchiliguirian at Onyx Capital Group. 'It's a bit like taking off a Band-Aid; you do it in one fell swoop.' RBC Capital analyst Helima Croft said in a note on Wednesday that a 411,000-bpd increase from July is the 'most likely outcome' from the meeting, primarily from Saudi Arabia. 'A key question will be whether the voluntary cut will be fully drawn down before the leaves turn brown in many parts of the world, in line with the original taper schedule,' she said. Prices were already lower in the session after Energy Information Administration data released on Wednesday showed US crude and fuel inventories showed surprise stock builds last week as crude imports hit a six-week high and petrol and distillate demand slipped. Crude inventories rose by 1.3 million barrels to 443.2 million barrels in the week ended May 16, the EIA said. Analysts in a Reuters poll had expected a drawdown of 1.3 million barrels. The EIA's surprise stock builds will exert downward pressure on prices, particularly on WTI, said Emril Jamil at LSEG Oil Research, adding that this could further encourage more US exports to Europe and Asia. Curbing losses on Thursday, US oil company Chevron's license to operate in Venezuela will expire on May 27, US Secretary of State Marco Rubio said in a post on his personal X account late on Wednesday. 'This statement by Rubio could be a game changer. But these deadlines have been extended in the past, so maybe the market is just not convinced yet,' said Phil Flynn, senior analyst with Price Futures Group. REUTERS
Business Recorder
14-05-2025
- Business
- Business Recorder
Crude oil climbs more than $1 on tariff cuts
HOUSTON: Crude oil futures climbed more than $1 a barrel on Tuesday, lifted by a temporary cut in US-China tariffs and a better than expected inflation report. Brent crude futures rose $1.11, or 1.71%, to $66.07 a barrel by 1443 GMT. US West Texas Intermediate (WTI) crude was up 95 cents, or 1.53%, at $62.90. The two benchmarks rose by about 4% or more in the previous session after the US and China agreed on sharp reductions to tariffs for at least 90 days, which also boosted Wall Street stocks 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, partner with Again Capital LLC. 'Also the data this morning gives the Fed room to potentially begin making some moves.' A US Labor Department report on Tuesday said inflation in April was 2.3%, the smallest year-over-year gain in four years, leading Wall Street firms like JP Morgan Chase and Barclays to cut forecasts of a US recession in the coming months. The lower inflation number is expected to encourage the US Federal Reserve to keep interest rates unchanged in the short term, which would encourage consumer spending. Fears of the impact of tariffs lifting prices were expected to lead to an increase in rates charged by the US central bank for lending money. The Organization of the Petroleum Exporting Countries and its allies, 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 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. It 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,' JP Morgan 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 US 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
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.
