Crude Oil Brent climbs above $58 on contract covering, geopolitical tension
Mar 12, 2015 | 0
SINGAPORE (Mar 12): Brent crude climbed above $58 a barrel on Thursday for the second straight session as speculators covered their positions ahead

Crude Oil
Brent inches towards $59 on Fed flexibility, Chinese factory growth
By Reuters / Reuters | February 25, 2015 : 11:30 AM MYT


SINGAPORE (Feb 25): Brent crude rose marginally towards $59 a barrel on Wednesday, helped by better than expected Chinese factory activity data, the Federal Reserve's flexible stance on U.S. interest rates and the eurozone's approval of reforms proposed by Greece.

U.S. crude was weaker, however, after settling lower for the fifth consecutive session on Tuesday on the back of a bigger than expected crude stock build-up.

Brent added 22 cents to $58.88 a barrel by 0317 GMT, while U.S. crude futures fell 2 cents to $49.26 a barrel.

China's factory sector showed marginal expansion, according to the flash HSBC/Markit Purchasing Managers' Index, which edged up to a four-month high of 50.1 in February, just above the 50 level that separates growth in activity from contraction. A Reuters poll of economists had forecast a reading of 49.5.

"That's good news (as it means) potential oil demand, but I think the market needs to see more stable and concrete demand from China," said Yusuke Seta, a commodity sales manager at Newedge Japan.

The same Chinese survey showed new export orders shrank at their fastest rate in 20 months.

China is the world's second-largest oil consumer after the United States.

Oil prices also drew support from Federal Reserve Chair Janet Yellen's suggestion that the U.S. central bank was preparing to consider raising interest rates "on a meeting-by-meeting basis". Some investors took that to mean rates may start rising later than June, the month markets had been focusing on.

Greece's four-month extension of its financial rescue on Tuesday also helped lift prices, as euro zone partners approved its reform plan, easing worries the country might leave the euro zone.

Still, concern about excess oil supplies continued to weigh on the market, limiting the impact of positive macroeconomic news, Seta said.

U.S. crude inventories rose by 8.9 million barrels last week as refineries cut output, versus an expected 4 million barrels, data from industry group the American Petroleum Institute showed on Tuesday.

Elsewhere, OPEC has no plans for an emergency meeting before June, its next scheduled gathering, two delegates said on Tuesday, responding to reports that Nigeria's oil minister, the current president of the cartel, would call for one.

Libya has resumed pumping crude from Sarir and Messla oilfields at the rate of around 40,000 barrels a day (bpd) to port Hariga after power was restored.

Crude Oil
Brent rises above $59 on hopes of economic recovery
By Reuters / Reuters | February 24, 2015 : 10:43 AM MYT
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SINGAPORE (Feb 24): Brent edged above $59 a barrel on Tuesday after a 2-percent slide the session before, buoyed by cautious optimism on the outlook for the global economy.

But the international oil benchmark is still 6-percent off a peak reached a week ago as worries about oversupply fester.

April Brent had risen 32 cents to $59.22 by 0236 GMT, while front-month U.S. crude was up 10 cents at $49.55.

"People are starting to get a sense of economic recovery and that's providing a bit of support and an underlying stream of confidence," said Jonathan Barratt, chief investment officer at Sydney's Ayers Alliance.

German business morale inched up to a seven-month high in February, the Ifo index showed on Monday.

Investors will be looking for other rays of hope in a slew of economic data from Europe and the United States later on Tuesday, including numbers on German GDP and U.S. consumer confidence.

Barratt added that the previous day's slide in oil prices could also have spurred some short-covering from investors.

Crude rose briefly on Monday when the Financial Times cited Nigeria's oil minister as saying the country would call an OPEC extraordinary meeting if prices fell further. But lingering doubts stemming from key Gulf OPEC members' resistance to curb production pared gains.

Oversupply worries also capped further upside momentum, with crude inventories in the United States expected to have increased by 4 million barrels to a record high in the week ending Feb. 20, a preliminary Reuters survey showed on Monday.

Refinery woes have also weighed on crude prices. The largest U.S. refinery strike in 35 years affecting 12 refineries that account for a fifth of national production capacity continued into its fourth week, and talks are not expected to resume this week.

Moody's: Most Asian O&G companies well-positioned to face low crude oil prices
By Meena Lakshana / theedgemarkets.com | February 23, 2015 : 5:23 PM MYT
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KUALA LUMPUR (Feb 23): The majority of Asian oil and gas companies are well-positioned to face low crude oil prices with their ample liquidity, even if their standalone credit quality deteriorates, a Moody’s Investors Service report revealed today.

According to the report, most of the companies have cash balances which are more than sufficient to meet their debt obligations and working capital needs over the next 12 months.

“The steep drop in crude oil prices since mid-2014 will materially reduce the earnings and cash flows of these companies and weaken their credit metrics in 2015,” said Moody's vice president and senior credit officer Vikas Halan in a statement yesterday.

The statement was issued in conjunction with the release of the Moody’s report, "Most Asian Oil and Gas Companies Remain Well-Positioned in Lower Oil Price Environment".

“But even with the deterioration in credit metrics, most Asian oil and gas companies will remain well-positioned at their current rating levels because their large liquidity buffers provide them with the financial flexibility to absorb the weak selling prices,” he added.

Halan co-authored the report with Moody's associate analyst Rachel Chua.

Moody’s expects companies with a higher reliance on earnings from oil, specifically, PT Pertamina (Persero), China National Offshore Oil Corporation, and PTT Exploration & Production Public Co Ltd, to see their credit quality weaken the most, given Moody’s oil price assumptions.

In addition, Moody's also believes that the ratings for the national oil companies in the region would remain supported by their associated sovereigns.

Most of these companies are rated at par with their sovereigns, reflecting their strategic importance to their individual country's energy agenda as well as the high likelihood of strong support from their government, it notes.

"Even if the baseline credit assessment (BCA), or standalone credit profile, of these companies weaken, the final rating will likely remain unaffected as a result of sovereign support," opined Chua.

The report also notes that downstream refiners will benefit from some support in regional refining margins and lower borrowing requirements to fund fuel subsidies that have declined as a result of energy reforms in Indonesia, India and China.

At the same time, Moody's expects refiners to be affected by high inventory losses in the last quarter of 2014 and early 2015 as oil prices decline.

It further notes that rising supply in crude oil is contributing to a global surplus that drove prices of the commodity down more than 50% as at the end of last year.

Reuters reported today that since the sharp drop in prices beginning June last year, crude oil prices have been gaining momentum since mid-January with Brent jumping almost US$20 a barrel to touch US$63 a barrel last week, as US producers decreased the pace of drilling.

However, oil prices dipped today on worries of oversupply in the United States (US), with Brent futures reaching around US$60 a barrel and US contracts hovering around US$50.70.

Reuters said the crude markets remain oversupplied, especially in the US with record high inventories, and that analysts expect prices to head back below US$50 per barrel in the coming weeks, with a target of US$43 per barrel over the next two to three months.

Crude Oil Brent price edges up on cautious optimism over Greek debt compromise
Feb 23, 2015 | 0
SINGAPORE (Feb 23): Oil prices edged up after early falls on Monday as parts of Asia returned from the Lunar New Year holiday, with Brent futures...

Crude Oil
Oil rises as OPEC producers signal optimism over market recovery
By Bloomberg / Bloomberg | February 17, 2015 : 3:21 PM MYT
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(Feb 17): Oil traded at the highest price in almost two months in London as OPEC ministers signaled confidence that the market can sustain its rebound.

Futures advanced as much as 1.2 percent, gaining for the third time in four days. There’s a sense of optimism in rising prices and the trend has changed over the past two weeks, Qatar’s Energy Minister Mohammed bin Saleh Al Sada said on Monday. The global supply glut is smaller than a previously estimated 1.8 million barrels a day, according to Ali Al-Omair of Kuwait, the third-largest producer in the Organization of Petroleum Exporting Countries.

Oil is recovering from the lowest prices in almost six years as drillers in the U.S., which is pumping crude at a record pace amid a shale boom, reduced the number of active rigs to the fewest since August 2011. The market is shifting its focus to tightening supply, according to Standard Chartered Plc.

“We’ve seen the rig numbers, that will impact estimates going forward,” David Lennox, a resource analyst at Fat Prophets in Sydney, said by phone. “There are forecasts for lower production by the end of 2015, especially out of the U.S., and that’s put a halt on the downtrend.”

Brent for April settlement climbed as much as 74 cents to $62.14 a barrel on the London-based ICE Futures Europe exchange and was at $62.08 at 2:41 p.m. Singapore time. The contract fell 12 cents to $61.40 on Monday. The volume of all futures traded was about 34 percent below the 100-day average.

Price ‘Optimism’

West Texas Intermediate for March delivery was up 41 cents from Friday’s close at $53.19 a barrel in electronic trading on the New York Mercantile Exchange. The floor session was suspended on Monday for the U.S. Presidents’ Day holiday and transactions will be booked Tuesday for settlement purposes.

OPEC, which supplies about 40 percent of the world’s oil, on Feb. 9 made the deepest cut in at least six years to its monthly projection for output growth from other producers, predicting the market’s drop means U.S. drillers will pump less than previously anticipated.

“Brent is near $62 and there’s a sense of optimism surrounding this issue,” Qatar’s Al Sada said at an annual meeting of Mesaieed Petrochemical Holding Co.

U.S. drillers reduced the number of rigs in service by 84 to 1,056, according to Baker Hughes Inc., an oilfield services company. Companies have idled 519 machines the past 10 weeks, a 33 percent reduction, the data showed.

Rig Counts

The decrease in rig counts isn’t enough to stop production growth, said Goldman Sachs Group Inc. Lower prices may be needed to balance the market because U.S. output could still expand by 600,000 barrels a day in the fourth quarter, compared with a year earlier, the bank said in a note on Monday.

The nation’s oil boom has been driven by a combination of horizontal drilling and hydraulic fracturing, which has unlocked supplies from shale formations including the Permian and Eagle Ford in Texas and the Bakken in North Dakota. Production averaged 9.23 million barrels a day through Feb. 6, the most in weekly Energy Information Administration records dating back to January 1983.

Brent has technical resistance at $61.83 a barrel, according to data compiled by Bloomberg. That’s the 23.6 percent Fibonacci retracement of the slide from a nine-month intraday high of $115.71 in June to January’s low of $45.19. Sell orders tend to be clustered around chart-resistance levels.

Crude Oil Brent hovers near $60, up almost 4 pct on week

Crude Oil Brent hovers near $60, up almost 4 pct on week

Crude Oil
Update: Brent holds above $56 after U.S. crude stocks rise less than expected
By Reuters / Reuters | February 11, 2015 : 11:44 AM MYT
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BEIJING (Feb 11): Brent crude held steady above $56 a barrel on Wednesday, and U.S. crude rose briefly more than $1, after a smaller than expected rise in U.S. crude stocks were viewed by some as a sign that a supply glut was starting to abate.

The gains in futures, however, were capped by a warning from the International Energy Agency (IEA) that ample global production would still swell world inventories before investment cuts begin to significantly dent output.

"The supply growth in 2015 is likely to continue unabated, albeit at a somewhat lower rate," Fereidun Fesharaki at Facts Global Energy said in a note on Wednesday.

"This all means a weak market in 2015 and even lower oil prices. Demand rebound will not save the oil market," he said.

Brent March crude futures had ticked down 13 cent to $56.30 by 0334 GMT, after losing $1.91 during the previous session on the IEA expectations.

U.S. March crude futures were trading up 30 cents at$50.32, after falling $2.84 in the previous session.

Oil prices are expected to test support levels, with Brent crude showing a good chance of breaking below $56.21, while U.S. crude could potentially break below $49.88, according to Wang Tao, a Reuters market analyst.

U.S. crude stockpiles rose last week less than half of what analysts had expected as refineries cut output, data from industry group the American Petroleum Institute (API) showed after the oil market settled on Tuesday.

U.S. crude stocks rose by 1.6 million barrels in the week to Feb. 6, the API said, compared with expectations for a increase of 3.7 million barrels.

Earlier on Tuesday the IEA had said the United States will remain the world's top source of oil supply growth up to 2020, even after the recent collapse in prices.

That bearish outlook was supported by the U.S. Energy Information Administration (EIA), which kept its 2015 and 2016 domestic oil output forecasts virtually unchanged from the previous month.

The EIA expects total U.S. oil production in 2015 to be 9.3 million bpd, slightly lower than the 9.31 million bpd forecast in last month's short-term energy outlook.

The head of Kremlin-controlled energy giant Rosneft said on Tuesday that OPEC had erred in not cutting output in a broadside blaming low oil prices on forces from financial speculators to U.S