Crude oil futures fall on weak global cues

Posted October 07, 2017

The global market is oversupplied by about 2 million barrels of oil a day. The latest inventory data from API added to pessimism with a 4.19-million-barrel build in gasoline stockpiles.

Wednesday's decline came as data from the American Petroleum Institute late Tuesday showed that USA crude supplies fell for a second week in a row, by 4.1 million barrels for the week ended September 29, but also indicated that gasoline stockpiles rose 4.2 million barrels, while inventories of distillates declined by 584,000.

Brent crude LCOc1 fell 26 cents to $55.86 a barrel after slipping 67 cents in the previous session, while the U.S. crude CLc1 dropped 15 cents to $50.43, reported Reuters.

Nigeria was shielded from output freeze due to the instability in the country's crude oil production.

Crude oil prices were moving closer to even moments before the opening bell in NY.

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Brent for December settlement dropped 48 cents, or 0.9%, to $55.52 a barrel on the London-based ICE Futures Europe exchange.

Should the uptake of EVs rise to one-third of new cars by 2040, as many industry analysts expect, up from just 1 percent today, that could "affect oil demand by around 9 million bpd", Barclays said. It notched up a third-quarter gain of around 20%, the biggest third-quarter increase since 2004 and traded as high as United States dollars 59.49 last week. Prices consolidate on the support area at $50. Hedge funds are again piling into oil, as are long-term passive investors, attracted not only by rising prices, but also by a profitable change in the forward-price curve .

Production from the 13 OPEC members participating in an agreement to cut output actually saw an increase of 60,000 barrels per day last month vs. The need for sustained production curbs is a sign the bulls are on fragile ground.

Azerbaijan's Energy Ministry reported that the country is committed to oil cut deal and daily oil production in the country amounted to 785,700 barrels in September, 733,000 barrels of which were crude oil and 52,700 barrels-condensate.

"Everyone realizes crude oil is somehow strong, but probably has not enough fuel to go higher", Johannes Benigni, managing director of JBC Energy GmbH, said in a Bloomberg Television interview.

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