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Crude oil futures have rallied to their highest finish in months, with WTI price climbing above $65 for the first time in two months after OPEC+ stuck with plans to gradually ease production curbs, signaling confidence in the demand outlook. The optimism has coincided with a breakout season for the S&P 500, with the Energy Sector (XLE) being particularly impressive. Indeed, the fossil fuel sector is enjoying a rare blowout season.
The Joint Technical Committee of OPEC+ is concerned about the growing case numbers in India, Japan, and Brazil, Reuters sources said on Monday. The Joint Technical Committee, or JTC, is responsible for assessing oil market fundaments. It is also tasked with monitoring which member countries are complying with the production cut quotas and which are not. The JTC is not changing its oil demand outlook at this time, but the group is keeping an eye on surging coronavirus cases in some substantial oil importers.
SINGAPORE: Oil prices edged down in early Asian trade on Monday after OPEC+ agreed last week to gradually ease some of its production cuts between May and July.Brent crude futures for June fell 16 cents, or 0.2 per cent, to $64.70 a barrel by 2351 GMT while U.S. West Texas Intermediate crude for May was at $61.32 a barrel, down 13 cents, or 0.2 per cent.
The market for moving oil across the world’s oceans is currently so bad that owners of the industry’s biggest supertankers are actually subsidizing the delivery of cargoes.We are probably never going to experience a demand increase similar to what we are likely to see over the next nine months for tankers,” said Eirik Haavaldsen, a shipping analyst at Pareto Securities AS in Oslo
New Delhi: India’s state refiners are considering purchasing fewer barrels from Saudi Arabia in May after the OPEC ignored New Delhi’s call for higher supplies to calm international crude oil prices.Weaker demand due to increasing Covid-19 cases or regular maintenance shutdowns may also contribute to lower purchase from Saudi Arabia in May, they said.
International energy leaders’ business lodestars have seen a “major realignment” over the past year as the pandemic encircled the globe toward a “humanising” agenda that has catapulted renewable energy production up their list of “actionable priorities”, according to a new report from the World Energy Council (WEC).In addition to this report, WEC hosts an interactive Issues Monitor online tool, developed with EPC giant Arup.
The United States overtook Saudi Arabia as India's second biggest oil supplier last month, as refiners boosted cheaper U.S. crude purchases to record levels and to offset supply cuts from the Organization of the Petroleum Exporting Countries and its allies (OPEC+), data from trade sources showed.
India has asked state refiners to speed up the diversification of oil imports to gradually cut their dependence on the Middle East after OPEC+ decided last week to largely continue production cuts in April. Two oil refiners confirmed that the government had asked them to expedite efforts to diversify crude import sources.
Saudi Arabia raised pricing for its crude for shipment to Asia and the U.S. next month after OPEC+ extended oil supply constraints, pointing to a tightening physical market. State oil producer Saudi Aramco increased pricing for Arab Light crude for Asia, its largest regional market, by 40 cents a barrel to $1.40 more than the benchmark. Aramco raised all other pricing to Asia, except for its Heavy crude which remained unchanged.
Oil rallied toward $70 a barrel after OPEC+ chose not to relax supply curbs even as the global economy pulls out of its pandemic-driven slump, confounding widespread expectations the group would loosen the taps. West Texas Intermediate edged higher in Asia, building on Thursday’s 4.2% surge to the highest close since April 2019. The producer alliance agreed to hold output steady in April, while Saudi Arabia said that it will maintain its 1 million barrel-a-day voluntary production cut.
India has reiterated its call to OPEC+ to increase oil production from April as the alliance meets this week to discuss future steps. While the market expects that the coalition, led by Saudi Arabia and Russia, will agree to an increase in production, the pace of recovery in output remains unclear.
Iraq said OPEC+ oil cartel is unlikely to change its production policy at next month’s meeting and repeated promises to deliver overdue output cuts. Iraq has a limit of 3.86million barrels per day for first three months of the year under the current agreement. Jabbar said Iraq will pump 3.6million barrels a day this month and cuts production by 200,000bbls a day.
On Monday, rising coronavirus cases in different parts of the world led to the decline in oil prices. The increasing tension between the US and China also contributed towards this downfall. Brent went down by 1.5% and was traded at $48.49 a barrel. WTI slipped by 1.8% and was traded at $45.44 a barrel.
OPEC+ has left the market in the state of uncertainty by delaying the decision on January's output. Oil prices dropped on Wednesday over these sentiments and a sudden build in oil inventories in the United States. Brent slipped by 0.9% and was traded at $47.01 a barrel. WTI decreased by 1% and was traded at $44.09 a barrel.
Oil prices dropped on Monday ahead of the OPEC+ meeting. Brent dropped by 1% and was traded at $47.72 a barrel. WTI slipped by 1.1% and was traded at $45.05 a barrel. The producer group met on Sunday but hasn't decided on oil output policy for 2021. Further talks will be held on Monday and Tuesday.
A weak dollar and recent vaccine progress lifted the spirit of the market on Friday. Brent increased by 0.6%, to $48.08 a barrel. WTI was down by 0.9%, to $45.31. However, JP Morgan stated, “While a successful vaccine rollout should break the link between infection and mobility, even then global oil demand will likely only reach its pre-pandemic run rate by mid-2022”.
"The recent breakthrough on a Covid-19 vaccine is a hope for the swift recovery of global energy demand next year. HSBC Bank analyst Gordon Gray recently stated-"The recent news around Covid-19 vaccines has boosted crude prices as markets start to look to a return to some sort of normality in 2021, also we expect OPEC+ to err on the side of caution as it evaluates how the market evolves.”
Successful coronavirus vaccine trials have helped the market extend the gains on Monday. Traders are looking for a substantial recovery in the demand of the crude. However, the gains were capped by the renewed lockdown in several countries. Brent increased by 0.5% and was traded at $45.17 a barrel. WTI gained 0.2% and was traded at $42.52 a barrel.