Saturday, 18 August 2018
Latest news
Main » Gold Plunges To 7-Month Low On Robust US Supplies

Gold Plunges To 7-Month Low On Robust US Supplies

20 June 2017

Oil prices fell on Wednesday after industry data showed a build in US crude stocks and OPEC reported a rise in its production despite a pledge to cut output.

The American Petroleum Institute published industry reports on USA energy levels, finding crude oil stockpiles increased by 2.8 million barrels and gasoline stockpiles increased by 1.8 million barrels last week.

In November previous year, when OPEC members agreed to cut production for the first time since the Great Recession, it was welcomed with great optimism and oil price jumped more than 20 percent, from $45 per barrel to as high as $55 per barrel (WTI).

The bearish gasoline data overshadowed a 1.7 million-barrel drawdown in US crude stocks, analysts said.

Brent crude oil fell 30 cents to $46.70 a barrel, its weakest since May 5 and just above six-month lows, before recovering a little to trade around $46.90 by 1345 GMT.

More news: What we know: Pedestrians struck near north London mosque

Pressure from US oil production and some OPEC members mean market balancing is stalled, the International Energy Agency reported Thursday.

OPEC, and some non-OPEC producers led by Russian Federation, agreed last month to extend supply curbs for nine months through to the end of March 2018.

OPEC and its allies have promised to restrict output until at least the end of the first quarter of next year to try to drain surplus supply.

"The revisions to non-OPEC supply growth have been much greater than the upward adjustments to world oil demand growth, accentuating the imbalance in the market", it said.

The IEA forecast an increase in non-Opec output of 1.5 million barrels per day to 59.7 million bpd in 2018, with U.S. output to reach more than 14.1 million bpd.

More news: Pakistan crush India by 180 runs to lift Champions Trophy

In its report released on Tuesday, the Organization of the Petroleum Exporting Countries said Iran produced 3.795 million bpd of oil in May, an increase of 4,000 bpd from 3.791 million bpd in April.

A report earlier this week found growing oil supply is set to outpace demand next year as production outside Opec is expected to grow twice as quickly in 2018 as it will this year.

Global oil output will expand faster than worldwide demand for oil next year, primarily as United States producers rack up production, and that could hamper exporters' efforts to prop up prices, the IEA said Wednesday. Gasoline inventories rose by 2.1 million barrels.

Sample bottle of crude oil are seen in this illustration photo June 1, 2017. Last time the price of oil fell, the stock markets fell with it.

Some traders still hope that Wednesday's readings from the US government will show declining inventories for oil and gasoline, as numbers from the Energy Information Administration don't always match those from the API.

More news: Woman picks up deadly rattlesnake thinking it was a toy