You are here: Home » Reuters » News
Business Standard

Oil falls 1 percent on swelling U.S. supply, concerns on U.S.-China trade talks

Reuters  |  SINGAPORE 

By Gloystein

(Reuters) - fell by about 1 percent on Thursday on swelling U.S. supply and amid a cautious reaction to trade talks between the and China, the world's two largest oil consumers, that finished without concrete details to ending their dispute.

U.S. Intermediate (WTI) were at $51.80 per barrel at 0432 GMT, down 56 cents, or 1.1 percent, from their last settlement.

International Brent crude futures were down 0.9 percent, or 57 cents, at $60.87 per barrel.

Both rose by around 5 percent the previous day as financial markets around the world surged on the hopes that and may soon be able to end their trade dispute, soothing fears of an all-out trade war between the two biggest economies and its possible impact on global growth.

By Thursday, however, the positive feelings ebbed because of a lack of a details on the talks despite a warm statement form on the outcome, and financial markets took a breather from the rally.

of consultancy in said in a note that dropped "as optimism fuelled by the U.S.-trade talks earlier in the week appeared to have run its course and official statements after the conclusion of three days of negotiations, while indicating modest progress, lacked details."

Meanwhile, U.S. cut its 2019 by more than 10 percent on Wednesday, pointing to "weakening economic growth expectations" and rising from especially from the as reasons for their lower price forecast.

now expects Brent to average $61 a barrel this year, down from a previous estimate of $69 a barrel, and U.S. crude to average $54 per barrel, against a prior forecast of $60.

The main source of new supply is the United States, where remained at a record 11.7 million barrels per day (bpd) in the week ending Jan. 4, the (EIA) said on Wednesday.

That has resulted in swelling fuel inventories.

Gasoline stocks rose 8.1 million barrels, to 248.1 million barrels, marking the largest weekly rise since December 2016, the EIA said. Distillate stocks swelled by 10.6 million barrels, to 140.04 million barrels.

Although crude stocks dipped by 1.7 million barrels, to 439.74 million barrels, they remained above their five-year seasonal average of 435 million barrels.

The surge in U.S. crude production runs counter to efforts led by the Organization of the Petroleum Exporting Countries (OPEC) to cut supply aimed at reining an emerging glut.

"Balancing the market would require OPEC discipline to continue well into 2020," said.

(Reporting by Gloystein; Editing by and Christian Schmollinger)

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Thu, January 10 2019. 10:54 IST
RECOMMENDED FOR YOU