Oil stocks to buy ahead of next OPEC meeting

Oct 12, 2017, 00:46
Oil stocks to buy ahead of next OPEC meeting

Strong U.S. oil production and a previous OPEC policy of defending market shares with robust output contributed to the oversupply a year ago.

U.S. West Texas Intermediate (WTI) crude futures CLc1 rose 38 cents, or 0.8 percent, to $51.30 a barrel.

Brent crude futures LCOc1 were trading down 14 cents, or 0.3 percent, to $56.47 per barrel by 12:32 p.m. EDT (1232 GMT).

Oil prices have increased for the third consecutive day amid stronger indications that the crude market is gradually tightening following years of oversupply.

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Speaking at an energy conference in New Delhi, OPEC Secretary General Mohammad Sanusi Barkindo said oil demand growth in 2018 should be "quite robust", while commercial oil stocks in the world's advanced economies continues to fall. The four-week moving average for USA oil production is up 11.8 percent from past year. "I don't think there are many losers out there".

US output was curtailed during last year's market downturn, though shale oil production in general has been more resilient to lower crude oil prices than anticipated.

The United States is not participating in the supply cut, and its crude output has risen 10 percent this year to more than 9.5 million bpd.

Saudi Arabia said it pumped 9.97 million barrels per day in September, up from August, but still below target.

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Last year, the bloc and some others producers chose to reduce production by around 1.2 million barrels per day from January 1, 2017. Analysts had expected a draw of 2 million barrels.

The API (American Petroleum Institute) is scheduled to release its weekly crude oil inventory report on Wednesday, October 11.

He also said Nigeria and Libya, who were exempted from the pact, "are making progress towards full recovery" of production, after which they could join the OPEC-led agreement.

Iraqi government forces and Iranian-trained Iraqi paramilitaries are "preparing a major attack" on Kurdish forces in the oil-rich region of Kirkuk and near Mosul in northern Iraq, the Kurdistan Regional Government (KRG) said. The main U.S. contract, WTI, was at $51.30.

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News of the outage sent USA gasoline margins RBc1-CLc1 up as much as 4.4 percent to a session high of $16.62 a barrel.