Oil Futures Lower Ahead of EIA Data

Oil Futures Lower Ahead of EIA Data

NEW YORK (DTN) -- New York Mercantile Exchange oil futures drifted lower at the start of regular trade Wednesday as the dollar edged higher while the market was disappointed by the delay in reaching a deal to cut production by the Organization of Petroleum Exporting Countries.

At last glance, the NYMEX January West Texas Intermediate crude oil futures contract eased 38cts to $47.65 bbl. The January Brent crude contract on the ICE futures complex dropped 30cts to $48.82 bbl.

The NYMEX December ULSD futures contract edged down 1.23cts to $1.5240 gallon and the December RBOB futures contract nudged 0.86cts lower to $1.4012 gallon.

Key to the oil futures decline this morning are reports saying OPEC will now wait until its Nov. 30 summit to debate a proposal to cut production after weeks of failed attempts to resolve all the issues separating key member countries.

The report said Iran and Iraq remain reluctant to go along with a proposal to cut output by a 4.0% to 4.5% range because they seek to be exempted since they've had interrupted output for a number of years.

There is concern an eventual agreement may be too little too late or compliance may be too weak to guarantee a near term rebalanced oil market.

OPEC had pledged back in September to limit production to a range of 32.5 to 33 million bpd, but they produced 33.64 million bpd in October, OPEC said earlier this month. They've also failed to agree on output quota allocations for individual member countries.

Meantime, the market awaits the Energy Information Administration to issue its oil supply report for the week-ended Nov. 18 at 10:30 AM ET.

The American Petroleum Institute late Tuesday reported a more-than-expected 1.3 million bbl crude stock draw and a bigger-than-expected 2.7 million bbl gasoline stock build. Distillate supplies fell by a smaller-than-expected 350,000 bbl, API said.