You are here
Oil trades near US$50 a barrel before US crude inventory data
[HONG KONG] Oil traded near US$50 a barrel before data forecast to show US crude stockpiles expanded for a second week.
Futures added 0.6 per cent in New York after declining 0.8 per cent Monday to the lowest level in more than a week. Crude inventories probably increased by 2.1 million barrels last week, according to a Bloomberg survey before an Energy Information Administration report on Wednesday.
Oil prices will probably trade near US$50 a barrel through the end of winter unless Opec reaches an agreement to trim supply, according to Credit Suisse Group AG.
Oil has fluctuated near that level for the past two weeks amid uncertainty about whether the Organisation of Petroleum Exporting Countries will be able to implement an agreement to reduce supply when they gather at an official meeting in November.
An Opec committee will meet later this month to try and resolve differences over how much individual members should pump.
"The oil price is consolidating," Chris Weston, chief market strategist at IG Ltd. in Melbourne, said by phone. "The market has priced in the good Opec news. It's unlikely that we'll see a collapse in oil, we'd need to see something pretty disappointing as we head into the November meeting for that to happen."
West Texas Intermediate for November delivery was at US$50.23 a barrel on the New York Mercantile Exchange, up 29 cents, at 8.59am in Hong Kong. The contract dropped 41 cents to US$49.94 on Monday for a second daily decline. Total volume traded was 30 per cent below the 100-day average.
Brent for December settlement was at US$51.79 a barrel, up 27 cents, on the London-based ICE Futures Europe exchange. Prices fell 43 cents, or 0.8 per cent, to US$51.52 a barrel on Monday. The global benchmark crude traded at a US$1.15 premium to December WTI.