Oil futures are set to fall lower on Thursday, with profits predicted by major oil producers next week debating a possible rise in output levels prompting prices to recover, after three days of direct benefits raise prices to new 13-month highs.
The Organization of the Petroleum Exporting Countries and its allies, known as OPEC +, will meet next week and are expected to decide on production quotas that are likely to occur in April.
Saudi Arabia astronomers say rising prices are likely to have led to a weakening in prices on Thursday, said Tariq Zahir, a managing member at Tyche Capital Advisors.
A report from Reuters said Wednesday that OPEC + could consider a production increase of 500,000 barrels per day when the group meets. OPEC + will hold a committee meeting on March 3, followed by the main decision-making meeting on March 4.
“We saw one run and with the 500 lb gorilla (the Saudis) talking about ending their volunteer cut, and maybe even increase supply,” Zahir told MarketWatch. It is not surprising to see, especially after the recent “bad run up” in oil prices. Also, the last thing the Saudis want to do is spur U.S. coal oil back online, he said.
West Texas Raw Intermediate for delivery in April CL.1,
CLJ21,
18 cents, or 0.3%, fell to $ 63.04 a barrel on the New York Mercantile Exchange.
Global benchmark benchmark against April Brent BRNJ21 crude contract,
ending Friday, it lost 28 cents, or 0.4%, to $ 66.76 a barrel on ICE Futures Europe, while May Brent crude contract was the most active BRN00,
BRNK21,
it was down 21 cents, or 0.3%, at $ 65.97 a barrel.
In a recent note, Robert Yawger, director of energy futures for Mizuho Securities USA, said that oil prices rose on Tuesday and Wednesday “because Chairman Fed Powell said he would continue to do what he is doing. thinking necessary to keep levels lower for longer. ”
Powell “has emphasized his intention to maintain a steady hand in two days of evidence on Capitol Hill. Risk management has benefited from what they have heard, ”said Yawger.
Meanwhile, oil prices have been able to move up as U.S. petrol supply data from the Energy Information Administration prevented further supply losses in the coming weeks.
Domestic crude supply rose unexpectedly by 1.3 million barrels for the week ending Feb. 19, the EIA reported, but analysts attributed the increase in winter storm-related disruption to distilling activity and oil exports, which also lead to a slowdown in oil production.
On Nymex Thursday, March gasoline RBH21,
down 0.7% at $ 1.883 gallons and heating oil March HOH21,
lost 0.5% to $ 1.898 per gallon, after Wednesday’s gains. Contracts expire in March at the end of a trading session on Friday.
Natural gas futures made only small shifts in Thursday’s deal, with the April NGJ21 contract,
down less than a penny, or 0.3%, at $ 2.787 per million British thermal units.
The EIA reported Thursday that domestic supply of natural gas was down 338 billion cubic feet for the week ending February 19, with the level of supply in storage now within the historical five-year average . On average, the data was expected to show a fall of 333 billion cubic feet for the week, according to analysts surveyed by S&P Global Platts.