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Crude Oil Prices - Weekly Outlook: October 8 - 12

Published 10/07/2018, 07:22 AM
© Reuters.  Oil Market Weekly Outlook
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Investing.com - Oil traders are likely to stay focused on potential disruptions to global crude supplies in the upcoming week, as looming U.S. sanctions on Iran are widely expected to lead to a tighter market.

The sanctions, which from November will include Tehran's oil exports, are being reinstated after U.S. President Donald Trump pulled out of the Iran nuclear deal earlier this year.

Iran is the third-biggest producer in the Organization of the Petroleum Exporting Countries (OPEC), supplying around 2.5 million barrels per day (bpd) of crude and condensate to markets this year, equivalent to around 2.5% of global consumption.

Many analysts say they expect Iranian exports to drop by around 1 million bpd once sanctions kick in.

Washington wants to cut Iran's oil exports to zero to put pressure on Tehran to renegotiate a nuclear deal.

November West Texas Intermediate crude, the U.S. benchmark contract, tacked on a penny on Friday to settle at $74.34 a barrel on the New York Mercantile Exchange. It reached a nearly four-year high of $76.90 on Wednesday

International benchmark Brent crude oil futures lost 42 cents, or 0.5%, to end at $84.16 a barrel on ICE Futures Europe. On Wednesday, the global benchmark hit a late 2014 high of $86.74.

Both crude benchmarks tallied a fourth weekly advance in a row. WTI rose 1.5%, while Brent crude advanced by 1.7%.

Oil prices at four-year highs have triggered concerns about demand as U.S. President Donald Trump has blamed OPEC for rising gasoline prices for American consumers.

Prices have eased slightly after Saudi Arabia and Russia said they would raise output to at least partly make up for expected disruptions from Iran.

Looking ahead, market players will also focus on monthly reports from OPEC and the International Energy Agency (IEA) this week to assess global oil supply and demand levels.

Fresh weekly data on U.S. commercial crude inventories - which come out one day later than usual due to Monday's Columbus Day holiday - will also capture the market's attention.

Ahead of the coming week, Investing.com has compiled a list of the main events likely to affect the oil market.

Monday, October 8

There will be no floor trading on the Nymex because of the Columbus Day holiday in the U.S. All electronic transactions will be booked with Tuesday's trades for settlement.

Wednesday, October 10

The American Petroleum Institute is to publish its weekly update on U.S. oil supplies.

Thursday, October 11

The Organization of Petroleum Exporting Counties will publish its monthly assessment of oil markets.

The U.S. Energy Information Administration will release its weekly report on oil stockpiles.

Friday, October 12

The International Energy Agency will release its monthly report on global oil supply and demand.

Later in the day, Baker Hughes will release weekly data on the U.S. oil rig count.

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