- Global Oil & Gas: 10 things you need might know about natural gas
- Mozambique Extractives: "Natural resources to be used in social justice" - President Nyusi
- Africa Oil & Gas: Sudan Wants ONGC Videsh To Withdraw Arbitration Over Oil Payment Dues
- Global Industry: Oilfield Service Sector to Hit Pre-Downturn Market Levels by 2024
- Mozambique Mining: Govt promotes fairs for the legal sale of precious stones
(Bloomberg) — Crude posted a second weekly gain as a whirlwind of rising geopolitical concerns stole the shale boom’s limelight.
Futures in New York jumped 1.9 percent on Friday, driving the U.S. benchmark to post a 0.5 percent rise this week after a shaky start on Monday and Tuesday. While record U.S. production beyond 10 million barrels a day has weighed on oil’s rebound, a sense of uncertainty was heightened by a slew of events like the firing of Rex Tillerson as U.S. secretary of state, the potential delay of Saudi oil giant Aramco’s initial public offering, talks of a trade war and expectations that Venezuelan production will plunge.
“You’ve got a lot going on, on the world stage,” Tamar Essner, an analyst at Nasdaq Inc. in New York, said by telephone. “The more unexpected elements of this week’s developments were on the macro, international, geopolitical front. We are setting ourselves up for a little volatility ahead.”
While the Organization of Petroleum Exporting Countries and allied producers trim output to tighten global markets, an ongoing rise in U.S. crude production threatens to block OPEC’s efforts. However, the International Energy Agency said this week that the decline in Venezuela’s oil output could exacerbate a global supply deficit later this year.
West Texas Intermediate for April delivery advanced $1.15 to settle at $62.34 a barrel on the New York Mercantile Exchange, the highest level in more than a week. Total volume traded was about 25 percent below the 100-day average.
Brent for May settlement climbed $1.09 to end the session at $66.21 a barrel on the London-based ICE Futures Europe exchange. The global benchmark traded at a $3.80 premium to WTI for the same month.
The market was little changed earlier in the session before spiking just before 11:30 a.m. in New York, with no news catalyst identified by traders and analysts.
“When the market falls into sideways trading in a band, you get a lot of price fluctuations that you have to turn a blind eye to,” said Gene McGillian, a market research manager at Tradition Energy in Stamford, Connecticut. “This area between $58 and $64, the market inside that, is still consolidating and looking for signals.”
Yet, Bank of America Merrill Lynch analysts including Francisco Blanch wrote in a report that oil may fall by $5 in the next few weeks if “some of the bears wake up from winter hibernation” and short positions return.
–With assistance from Tsuyoshi Inajima and Alex Longley
To contact the reporter on this story: Jessica Summers in New York at email@example.com.
To contact the editors responsible for this story: David Marino at firstname.lastname@example.org, Catherine Traywick, Carlos Caminada