Oil caps third weekly loss as US stockpiles sustain glut| MENAFN.COM

Monday, 24 January 2022 01:52 GMT

Oil caps third weekly loss as US stockpiles sustain glut

(MENAFN- Khaleej Times)

Oil capped a third weekly decline in New York on signs a global glut will be prolonged as US stockpiles see their longest run of gains in seven months.

West Texas Intermediate oil fell 0.9 per cent this week. US crude stockpiles rose an eighth week leaving supplies more than 100 million barrels above the five-year average for this time of yeargovernment data showed on Wednesday. Brent futures climbed in London after European Central Bank President Mario Draghi hinted at additional stimulus.

Crude has slumped 47 per cent in the past year amid speculation a surpluswill persist as the Organisation of Petroleum Exporting Countries threatened by surging output mainly from North America and Russia continues to pump above its quota.Saudi Arabia is working with producers inside and outside the 12-member group to stabilise the market Saudi Oil Minister Ali Al Naimi said in Bahrain Thursday.

West Texas Intermediate for December delivery which expired on Friday fell 15 cents or 0.4 per cent to settle at $40.39 a barrel on the New York Mercantile Exchange. It was the lowest close for a contract closest to expiration since August 26. The more-active January futures increased 18 cents to $41.90.

Brent for January settlement advanced 48 cents or 1.1 per cent to end the session at $44.66 a barrel on the London-based ICE Futures Europe exchange. The European benchmark crude closed at a $2.76 premium to January WTI. - Bloomberg

US crude stockpiles expanded to 487.3 million barrels in the week ended on November 13 according to Energy Information Administration data. Refinery rates rose while inventories at Cushing Oklahoma the delivery point for WTI and the biggest US oil-storage hub increased for a second week.

The global economy is going through an unstable period Saudi Arabia's Al Naimi said on Thursday. Crude demand is expected to rise by one million barrels a day every year in this decade and the world requires more investments in oil to compensate for declining recovery rates he said.

Brent gained after Draghi set the scene for further action in two weeks' time saying the institution will do what's necessary to reach its inflation goal rapidly.

WTI climbed from its lows after the number of active US oil rigs dropped to a five-year low. The active oil rig count fell by 10 to 564 this week according to data compiled by Baker Hughes.

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