Oil prices dip on relentless rise in USA crude output

  • Oil prices dip on relentless rise in USA crude output

Oil prices dip on relentless rise in USA crude output

"It appears that money managers are getting rid of their long positions and this is why the front-end spreads of the two main crude oil futures contracts have been drifting lower lately".

Oil slid in NY amid concern that global demand might not absorb swelling USA supplies. April West Texas Intermediate crude fell 68 cents, or 1.1%, to settle at $61.36 a barrel on the New York Mercantile Exchange.

Oil risks sliding back under US$60 a barrel as a surge in USA shipments to Asia threatens to undermine a deal between OPEC and its allies, according to ING Groep NV.

Iran is allowed to pump up to 3.8 million bpd under a global pact between OPEC, Russia and other oil producers to limit supply. "They continue to give market share away to the U.S".

The Energy Information Administration (EIA) said the USA may drastically reduce its import of crude oil from Nigeria by 2022, going by its projection of becoming a net energy exporter in four years.

Both crude benchmarks dropped by around 1 percent on Monday after the U.S. Energy Information Administration said output from the shale basin would hit a new record high in April.

"Oil prices moved lower. after (the) Energy Information Administration published a report that crude production from seven major USA shale plays is expected to see a climb", said Stephen Innes who is head of trading for Asia/Pacific at futures brokerage OANDA in Singapore. In February, even Saudi Arabia's state oil company considered participating in these flows via a us unit, before determining it wasn't economically viable at the time. That compared with analysts' expectations for an increase of 2 million barrels.

Oil-market news. Futures sliding into contango is just one indicator signaling that prices may come under pressure President Donald Trump, ousting Secretary of State Rex Tillerson, said he had disagreed with the chief US diplomat over a nuclear accord with Iran.

Refinery crude runs rose by 85,000 barrels per day (bpd), API data showed.

He concluded, "We think compliance is likely to slip; the deal will still officially be in place, but once we get into 2019 there's no chance that we will see some sort of deal".