Oil Pares Strongest January Since 2013 on U.S. Supply Outlook

Oil slipped for a third day in New York, continuing its retreat from a three-year high, on estimates that U.S. crude stockpiles increased last week.

“Strong U.S. crude supply growth and deteriorating inventory dynamics” could “trigger a sentiment shift and unsettle the record speculative length in the oil market,” said Giovanni Staunovo, an analyst at UBS Group AG in Zurich.

Ten consecutive weekly declines in American stockpiles had helped crude breach $66 a barrel for the first time since December 2014. Oil’s fifth consecutive monthly gain has also been driven by a weaker dollar amid conflicting remarks on the currency from President Donald Trump and his top officials.

U.S. crude stockpiles climbed by 3.23 million barrels last week, the American Petroleum Institute was said to report, before Energy Information Administration data on Wednesday. Meanwhile, American oil production climbed to 9.88 million barrels a day in the week ended Jan. 19, the highest level in weekly EIA data since 1983.

Gasoline inventories rose by 2.69 million barrels last week, while distillates fell, according to the API report. Front-month gasoline futures on the Nymex are set for a 4.7 percent gain in January, a second monthly increase, while diesel futures are headed for a 0.4 percent drop to $2.0683 a gallon this month, ending a sixth consecutive monthly advance.
more at:  https://www.bloomberg.com/news/articles/2018-01-31/oil-extends-drop-below-64-as-industry-data-show-stockpile-gain

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China Tariffs Hurt US Crude Oil Price

The war of words over trade between the United States and China finally turned into an actual trade war Friday, after the administration of President Donald Trump announced a list of goods whose import from China, worth $50 billion in 2017, would be subject to an additional tariff of 25 percent. Among the retaliatory measures announced by the Asian country was the proposed imposition of tariffs on imports of petroleum products from the U.S., a move that sent domestic crude oil prices crashing. The fall in WTI crude is not in tandem with the global benchmark, Brent crude, which was trading about 0.7 percent higher Monday morning than a day before. The two prices are separated by a few dollars, Brent usually costing more, but that gap has increased in recent weeks for a number of reasons. However, the different directions in trade at present are caused largely by China’s announcement. Click Read More below for additional information.
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