Oil Mixed in Thursday Trade
NEW YORK (DTN) -- New York Mercantile Exchange (NYMEX) spot-month oil futures were shallowly mixed Thursday morning as concerns about rising crude oil production in the United States and a firmer U.S. dollar weighed against higher equities.
The three main indices on Wall Street -- Dow Jones Industrial Average, S&P 500 and Nasdaq 100 -- have stabilized and are higher in early trading, while the U.S. dollar index is posting gains.
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The stock market has a correlative trading relationship with oil while the dollar trades inverse to the oil futures complex. Markets remain volatile.
On Wednesday, the Energy Information Administration (EIA) reported U.S. crude oil production increased by 86,000 barrels per day (bpd) during the week ended March 2 to a 10.369 million bpd record high, up 1.281 million bpd from a year ago. Since the end of January, output has risen by 450,000 bpd.
Domestic crude output is expected to grow this year at a 1.4 million bpd year-on-year rate to 10.7 million bpd, and then to 11.3 million bpd next year, according to EIA's monthly report issued on Tuesday.
This comes as U.S. shale producers met this week with officials of the Organization of Petroleum Exporting Countries (OPEC) at an oil conference in Houston. OPEC Secretary Mohammad Barkindo said they were not worried by the shale boom.
However, analysts see the relentless surge in U.S. output offsetting production cuts by OPEC and their 10 partners, with the U.S. set to become the world's biggest oil producer. OPEC suggested but has not yet decided on extending through next year their two-year 1.8 million bpd in production cuts.
At 9 a.m. ET, NYMEX April West Texas Intermediate crude oil futures were up 13 cents at $61.28 barrel (bbl). Intercontinental Exchange May Brent crude was flat at $64.34 bbl. NYMEX April ULSD futures were little changed at $1.8758 gallon, while April RBOB futures down 1.20 cents printing $1.8983 gallon.
George Orwel can be reached at george.orwel@dtn.com
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