Oil Futures Settle Mixed Thursday

WASHINGTON, D.C. (DTN) -- New York Mercantile Exchange nearest delivered oil futures and Intercontinental Exchange Brent futures settled mixed Thursday afternoon. West Texas Intermediate and Brent edged lower but held near four-month highs, underpinned by Wednesday's U.S. government data that showed a large fall in domestic crude inventories as production cuts from Organization of the Petroleum Exporting Countries tightens the global oil market.

Nymex May WTI futures lost $0.25 to settle at $59.98 barrels (bbl), while ICE May Brent futures finished the session $0.64 down at $67.86 bbl. Nymex April RBOB futures advanced 0.37 cents to $1.9203, a fresh five-month high on the spot continuous chart, and April ULSD futures settled down 2.1 cents to $1.9871 gallon.

While lower on the session, oil futures are positioned for further gains as OPEC production cuts run through the end of June, and as Saudi Arabia targets lower crude oil exports to the United States to boost global oil prices. Saudi Arabia has limited crude exports to the United States to 4.29 million bbl during the first two months of the year, with the rate declining. Last month, Saudi Arabia shipments to U.S. refineries were at 1.6 million bbl against 5.75 million bbl a year ago according to Bloomberg data.

Earlier this month, Saudi Energy Minister Khalid Al-Falih said the kingdom plans to cut its total crude oil exports in April to below 7 million barrels per day (bpd), while Saudi Aramco's oil allocations for April are already 635,000 bpd below requests made by purchasing refineries.

OPEC aims to rebalance global oil market through lowering crude inventories in Organization for Economic Cooperation and Development countries to below five-year average level. According to Bernstein Energy, OPEC+ cuts would result in an inventory draw of 37 million bbl in the first quarter for the 36 OECD member countries.

In the United States, oil inventories, which represent nearly 45% of the total OECD stockpiles, dropped to 1.2219 billion bbl last week, a 6-1/2 month low, down 45.21 million bbl or 3.6% from mid-January when they reached a 15-month high.

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