Oil Trades Above $49 as Saudis Said to Curb Crude Sales to Asia

Futures rose 0.7 percent after dropping Monday. Saudi Arabia will supply lower volumes than some customers requested for September, with the cuts spanning grades, people with knowledge of the matter said. In Abu Dhabi, officials from Russia and Kuwait are meeting producers to examine why some are shirking pledges to curb output, while in the U.S., stockpiles may have fallen last week.

Oil in New York rose above $50 a barrel early last week, before slipping as signs of rising global supply eroded optimism that curbs by the Organization of Petroleum Exporting Countries and its partners are rebalancing the market. The failure of OPEC’s efforts amid expanding output in Libya and Nigeria and lower compliance by some nations has spurred Saudi Arabia to take more action.

Prices “are profiting from Saudi Arabia’s announcement that it will be reducing its oil shipments,” said Eugen Weinberg, head of commodities research at Commerzbank AG in Frankfurt. “This announcement is remarkable to the extent that domestic demand declines in September, meaning that more crude oil will be available for export if production remains unchanged.”

West Texas Intermediate for September delivery was at $49.73 a barrel on the New York Mercantile Exchange, up 34 cents, at 10:45 a.m. London time. Total volume traded was about 11 percent above the 100-day average. Prices lost 19 cents to $49.39 on Monday.

Brent for October settlement gained 31 cents to $52.68 a barrel on the London-based ICE Futures Europe exchange, after losing 5 cents on Monday. The global benchmark crude traded at a premium of $2.81 to October WTI.
more detail at: https://www.bloomberg.com/news/articles/2017-08-07/oil-trades-near-49-as-talks-continue-on-output-cut-compliance

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