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Crude settles weaker in U.S. with supply picture in focus

Published 01/30/2017, 03:10 PM
Updated 01/30/2017, 03:13 PM
© Reuters.  Crude weaker in U.S. trade
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Investing.com - Crude prices settled weaker in U.S. on Monday as investors weighed the supply response of U.S. shale drillers to prices above $50 a barrel and noted the domestic and international backlash to President Donald Trump's move to bar travelers from seven Muslim-majority countries from entering the U.S.

Investors were also keeping an eye on central bank policy reviews in Japan due Tuesday in Asia, as well as the U.S. and U.K. are slated this week that could set the tone on demand prospects.

On the New York Mercantile Exchange, crude oil for delivery in March fell 1.00% to $52.64 a barrel. On the Intercontinental Exchange in London, Brent oil for March delivery eased 0.63% to $55.35 a barrel.

As usual, weekly data on U.S. stockpiles of crude and refined products on Tuesday and Wednesday will be closely eyed.

Last week, traders noted rising production in the U.S. after oilfield services provider Baker Hughes said late Friday that the number of rigs drilling for oil in the U.S. increased by 15 in the previous week, bringing the total count to 566, the most since November 2015.

U.S. oil production has increased almost 6% since the mid of the last year to almost 9 million barrels per day (bpd).

The start at the New Year of a coordinated deal by OPEC and non-OPEC member countries such as Russia to reduce output by almost 1.8 million bpd to 32.5 million for the next six months has supported prices globally above $50 a barrel. As well, the International Energy Agency (IEA) has forecast continued demand growth by leading importers in emerging economies in Asia such as China and India.

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