gpolit.com
gpolit.com February 25, 2018


Oil prices shrug off USA record

02 February 2018, 09:13 | Kenneth Drake

The US oil production exceeded 10 million barrels per day for the first time in four decades

Oil production hits 10 million barrels per day

USA output surpassed 10 million bpd in November for the first time since 1970, the Energy Information Administration said this week.

On Friday, the price of Brent crude was up 0.09% to $69.85 a barrel, having earlier returned to the $70 level after three days. US West Texas Intermediate (WTI) crude was up 0.47% at $66.11 a barrel.

Russian Federation was followed by Saudi Arabia with 9.9mn barrels of average daily oil output.

In recent months, WTI prices have climbed higher and the rig count has also started to turn up again, which should boost production in the second half of 2018.

One thing necessary for the market to stay in balance will be a continued rise in USA shale production, says Goldman. Meantime, the dollar stopped losing value, re-moving one of the main positive drivers for oil/fuel prices over the past two months.

And while breaching this threshold has been something many analysts have feared would upset the delicate supply/demand balance supposedly being achieved by the Organization of the Petroleum Exporting Countries (OPEC) via its production cuts, the US boom may benefit offshore entities, including storage terminal operators in the Caribbean.

The market reversed course after the U.S. Energy Information Administration reported gasoline inventories dropped by nearly 2 million barrels last week, and distillates like diesel declined by about the same.

The investment bank revised up its forecast for demand growth in 2018 and forecast that oil prices could rise to $82.50/b by mid-year.

OPEC has pegged OECD oil inventories at 133 million barrels above the five-year average as of November.

So the total lag from a change in prices to a change in production can be six to 12 months especially once delays in reporting are taken into account.

Following this, there have been an increasing number of incidents ratcheting up tension in the region - from worker abductions to fuel shortages to heavy clashes. EIA's Petroleum Supply Monthly data for October 2017 show that the largest increases in USA crude oil exports were to Asia, followed by Europe.

Futures rose for a second day in NY, adding as much as 1.4 per cent. The decline in Venezuelan production is also providing support.

The cuts have offset gains in US crude production.

USA crude, meanwhile, is flowing into global markets.



Other News

Trending Now

Rep. Rodney Frelinghuysen Announces Retirement from Congress
The Cook Political Report has shifted his reliably Republican-leaning district to a " toss-up " this year. Frelinghuysen won by nearly 20 points in 2016, but he was viewed to be vulnerable this cycle.

Elon Musk denies secretly creating zombie apocalypse to fuel demand for flamethrowers
This product is a "super awful idea", he notes in his post, yet it's now available for preorder on the company's site. Elon Musk may be selling flamethrowers, but he swears he's not setting up for the zombie apocalypse.

Rare 'super blue blood moon' coming Wednesday
On Jan. 31, the sun, moon and Earth line up (syzygy), so that Earth's shadow blocks sunlight normally reflected off the moon . In this week's case, the full moon Tuesday night will be about 7% larger and 14% brighter than the typical full moon .

Three people dead after helicopter crash in California
Helicopter video showed a portion of the helicopter covered by a yellow tarp. Skid marks were seen on the road leading up to the crash site.

Wall Street falls as high bond yields, sinking health stocks weigh
The bank is about to undergo a change of leadership as Janet Yellen, who is viewed as favouring low interest rates, steps down. By notching another month of gains in January, the Dow and S&P 500 are on track to extend their win streaks to 10.

Space Exploration Technologies Corp. Launches its Biggest Rocket
The Falcon Heavy rocket consists of 3 Falcon 9 first stages, and each Falcon 9 rocket is powered by 9 Merlin engines. Apart from an eruption of flames and smoke, it'll destroy Musk's Tesla - and, potentially, decimate the launch pad.

Samsung Galaxy S9 Active likely in the works for this year
However, the phones internally codenamed as "star" and "star2" aren't the only thing Samsung's engineers have been cooking up. One small but important upgrade on this year's smartphones from Samsung will change the rear fingerprint sensor's position.

Conor McGregor responds to Floyd Mayweather stepping into octagon: 'F--- the Mayweathers'
Mayweather defeated McGregor via 10th round technical knockout in a boxing match at the T-Mobile Arena in Las Vegas on August 26. The post comes just one day after Mayweather shared a picture of himself punching Conor McGregor during their boxing match.

America believes 5G network will cut China spying on phone calls
In the first scenario, the government would rent access to carriers like AT&T and Verizon, Axios reported . The idea of a government-controlled 5G network is not something that pleases everyone.

Peacock denied as emotional support animal for flight
"I've actually not had a situation where we had something go terribly awry with an emotional support animal , aside from a cat". A woman was recently denied her emotional support animal when she attempted to fly on United Airlines , a peacock .