WTI crude oil futures fall as supplies seen rising; Brent slips2 min read . Updated: 28 Oct 2014, 07:46 PM IST
WTI for Dec delivery fell 25 cents to $80.75 a barrel on the New York Mercantile Exchange
New York: West Texas Intermediate (WTI) retreated amid speculation that US crude stockpiles increased last week. Brent oil declined in London.
A government report on Wednesday will probably show that crude supplies rose 3.8 million barrels last week, according to a Bloomberg survey of analysts. US orders for durable goods dropped unexpectedly in September, a report showed on Tuesday. Prices have slipped 11% this month on signs that global oil production is growing faster than demand for fuel.
“We’re waiting for tomorrow’s storage report," Bob Yawger, director of the futures division at Mizuho Securities USA Inc. in New York, said by phone. “The consensus is for a gain of 3-to-4 million barrels, but we were looking for a 3 million-barrel gain last week and got 7 million. If something similar happens this week, WTI will come under pressure."
WTI for December delivery fell 25 cents to $80.75 a barrel at 9:38 am on the New York Mercantile Exchange. Futures touched $79.44 on Monday, the lowest intraday level since 29 June, 2012. The volume of all futures traded was 15% below the 100-day average for the time of day. Prices have declined 18% this year.
Brent for December settlement decreased 49 cents to $85.34 a barrel on the London-based ICE Futures Europe exchange. The volume of all futures traded was 46% lower than the 100-day average. The European benchmark crude traded at a $4.55 premium to WTI, down from $4.83 at Monday’s close.
US gasoline inventories probably declined 700,000 barrels in the week ended 24 October, based on the median estimate of 10 analysts surveyed by Bloomberg before Wednesday’s report from the Energy Information Administration (EIA).
The American Petroleum Institute in Washington will publish separate supply data on Tuesday. The industry group collects information on a voluntary basis from operators of refineries, bulk terminals and pipelines, while the government requires that reports be filed with the EIA, the energy department’s statistical arm.
Barclays reduced its estimate for the average Brent price in 2015 to $93 a barrel from $96, and for WTI prices to $85 from $89.
“Opec supply-side adjustments are expected, but these are unlikely to be sufficient to overcome a lackluster demand picture in the first half of the year," analysts Miswin Mahesh and Michael Cohen wrote in the report.
The Organization of Petroleum Exporting Countries (Opec) is unlikely to reduce its production target when it meets next month, Mohsen Qamsari, a director for international affairs at National Iranian Oil Co., said on Monday according to the oil ministry’s news service. Bloomberg
Grant Smith in London also contributed to this story.