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NYMEX crude falls in Asia with API estimates in focus

Published 03/28/2016, 08:07 PM
Updated 03/28/2016, 08:09 PM
© Reuters.  NYMEX crude weaker in Asia
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Investing.com - Oil prices eased in Asia on Tuesday with U.S. industry data ahead on stockpiles.

On the New York Mercantile Exchange, WTI crude for May delivery fell 0.15% to $39.33 a barrel.

The American Petroleum Institute will release its estimates of crude, gasoline and distillates stocks late Tuesday. That will be followed by more closely-watched data from the U.S. Department of Energy.

Overnight, crude futures were relatively flat on Monday in thin post-Holiday trading, as investors continued to drag their feet ahead of next month's highly-anticipated meeting between OPEC and Non OPEC members which could result in the oil cartel's first deal with producers outside the group in more than 15 years.

On the Intercontinental Exchange (ICE), Brent crude for June delivery wavered between $40.59 and $41.80 a barrel, before closing at $40.85, down 0.18 or 0.44% on the trading day. North Sea brent futures have fallen slightly since reaching 2016 yearly highs earlier this month when they jumped above $42.50. Since briefly dipping below $30 in mid-February, brent crude has rallied by approximately 15%.

Following one of its strongest monthly rallies over the last decade, oil prices could enter a bit of a holding pattern over the next several weeks until a major summit between OPEC and Non OPEC producers on April 17 in Doha. At the meeting, Saudi Arabia, Russia and two other OPEC producers could freeze output at their respective levels from January. Last week, Libya joined Iran in declining an invitation to the summit.

Thus far, 10 major producers, Algeria, Iraq, Kuwait, Nigeria, Qatar, Saudi Arabia, United Arab Emirates, Venezuela, Oman and Russia, which drill more than 37.2 million barrels per day combined, have committed to the meeting. Another seven nations, Angola, Ecuador, Indonesia, Mexico, Kazakhstan, Azerbaijan and Norway, representing approximately 7 million bpd in production, remain uncommitted. Despite the recent rally, oil prices are still down by more than 60% from their peak in June, 2014 at $115 a barrel.

A wave of soft economic data also came overnight after the U.S. Department of Commerce downwardly revised consumer spending gains in January from 0.5% to 0.1%. At the same time, the Federal Reserve Bank of Atlanta cut its first quarter GDP growth forecast from 1.4% to 0.6% on Monday.

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