Oil Heads for Second Monthly Gain as OPEC Strategy Pays Off

Futures were little changed in New York and are up 4.8 percent this month, after rallying 9.4 percent in September. U.S. crude inventories probably declined for a fifth time in six weeks, according to a Bloomberg survey before government data due Wednesday. Saudi Arabian Crown Prince Mohammed bin Salman said last week that he backed prolonging supply curbs, following a similar endorsement by Russian President Vladimir Putin earlier this month.

Global benchmark Brent crude this month topped $60 a barrel for the first time since 2015 on hopes the Organization of Petroleum Exporting Countries and partners including Russia will prolong their curbs aimed at eliminating a glut. Prices were also boosted by fighting between Iraqi government troops and Kurdish forces in the oil-rich Kirkuk region. Still, the potential for continued supplies from U.S. shale fields is a concern.

“The oil market is tightening and the supply surplus is shrinking,” said Norbert Ruecker, head of commodity research at Julius Baer Group Ltd. in Zurich. “Sentiment is very bullish since the market seems to expect that the supply surplus will erode further heading into 2018.”
more detail at:  https://www.bloomberg.com/news/articles/2017-10-31/oil-holds-gains-near-8-month-high-as-u-s-supplies-seen-falling

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Oil Above $50 as Fuel-Stockpile Drop Counters Crude-Supply Gain

November futures dropped 0.5 percent in New York after climbing 1.6 percent Wednesday. Gasoline supplies dropped a third week to the lowest level since November 2015, while distillate stockpiles fell by the biggest amount since 2011, according to government data. Crude inventories expanded by 4.59 million barrels last week, more than the 3.9 million-barrel gain projected in a Bloomberg survey. U.S. oil production also rose a second week. “The market focused on the sharp recovery in crude demand implied” by the decline in fuel inventories on Wednesday, said Jens Naervig Pedersen, a senior analyst at Danske Bank A/S in Copenhagen. “It adds to the bullish sentiment buoyed by concerns about the Iran nuclear deal and headlines about OPEC looking at a possible extension of output cuts.” U.S. gasoline stockpiles fell by 2.13 million barrels last week to 216.2 million, the Energy Information Administration reported Wednesday. Distillate inventories, a category that includes diesel, dropped by 5.69 million barrels. Crude output expanded by 157,000 barrels a day to 9.51 million a day. Click Read More below for more of the story.
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