Oil Futures Mixed Ahead of EIA Data

Brian L Milne
By  Brian L. Milne , DTN Refined Fuels Editor

WASHINGTON (DTN) -- Oil futures nearest delivery traded on the New York Mercantile Exchange and Brent futures on the Intercontinental Exchange moved mixed early Thursday following overnight losses spurred by bearish data released by the American Petroleum Institute late Wednesday showing weekly builds in U.S. commercial crude, gasoline and distillate fuel stockpiles.

In midmorning trade, the West Texas Intermediate March contract gained $0.11 to $52.73 per barrel (bbl) while ICE March Brent was down $0.20 to $60.94 bbl. NYMEX February ULSD futures eased 0.47 cent to $1.8839 gallon while February RBOB futures gained 0.32 cent to $1.3889 gallon.

In its weekly supply report, the API showed a large build in commercial crude oil stockpiles in the week-ended Jan. 18, while also detailing an increase in gasoline and distillate supplies. API reported crude supplies jumped 6.551 million bbl during the week profiled versus an expected 750,000 bbl draw. API data showed crude supply at the Cushing, Oklahoma hub rose 359,000 bbl.

The U.S. Energy Information Administration will release its supply report for the week ended Jan. 18 at 11:00 a.m. EST.

The Organization of the Petroleum Exporting Countries' Secretary General called for continued cooperation with non-OPEC oil producing nations, while highlighting engagement with U.S. shale producers, speaking Wednesday at the World Economic Forum in Davos, Switzerland.

During a rare occasion when OPEC and U.S. oil companies were on the same panel, Mohammed Barkindo said: "We have to collaborate. It's one industry. It's a global industry, and I think our colleagues in the U.S. are on the same page with us and we will work together to exchange views."

Hess Corporation CEO, John Hess, thanked OPEC for its price-bolstering production cuts of the last two years, while noting the U.S. industry needs higher and stable oil prices.

OPEC, Russia and nine other non-OPEC allies in December agreed to cut 1.2 million barrels per day (bpd) for the first six months of 2019, after completing a two-year 1.8 million bpd production cut agreement.

Financial Times reported earlier this week that because of the slump in oil prices in the fourth quarter 2018, U.S. oil companies have struggled to raise capital with not a single bond sold since November. According to the report, U.S. shale industry has relied heavily on debt to finance its growth, with exploration and production companies raising about $300 billion from bond assurances over the past 10 years.

Liubov Georges can be reached at liubov.georges@dtn.com


Brian Milne