Oil pares losses on tight supply but cloudy demand caps gains

Home Business Oil pares losses on tight supply but cloudy demand caps gains 13-11-2024 10:09 AM Ammon News - Oil prices edged up on Wednesday on signs of near-term supply tightness but remained near their lowest in two weeks, a day after OPEC downgraded its forecast for global oil demand growth in 2024 and 2025. Brent futures rose 17 cents, or 0.24%, to $72.06 a barrel by 0420 GMT, while U.S. West Texas Intermediate (WTI) crude futures gained 14 cents, or 0.21%, at $68.26. "Crude oil prices edged higher as tightness in the physical market offset bearish sentiment on demand. Buyers in the physical market have been particularly active, with any available cargoes being snapped up quickly," ANZ analysts said in a note. But falling demand projections and weakness in major consumer China continued to weigh on market sentiment. "We may expect prices to consolidate around current levels for longer," said Yeap Jun Rong, market strategist at IG, adding the recent attempt for a bounce was quickly sold into. "The absence of a more direct fiscal stimulus out of China has been casting a shadow on oil demand outlook, coupled with the prospects of higher US oil production with a Trump presidency and looming OPEC+'s plans for an output raise," Yeap added. In its monthly report on Tuesday, the Organization of Petroleum Exporting Countries (OPEC) said world oil demand would rise by 1.82 million barrels per day (bpd) in 2024, down from growth of 1.93 million bpd forecast last month, mostly due to weakness in China, the world's biggest oil importer. Oil prices settled up 0.1% on Tuesday following the news, after falling by about 5% during the two previous sessions. OPEC also cut its 2025 global demand growth estimate to 1.54 million bpd from 1.64 million bpd. Two U.S. central bankers said on Tuesday that interest rates are acting as a brake on inflation that is still above the 2% mark, suggesting that the Federal Reserve would be open to further interest rate cuts. The Fed cut its policy rate last week by a quarter of a percentage point to the 4.50%-4.75% range. Interest rate cuts typically boost economic activity and energy demand. Reuters

Home Business

Oil pares losses on tight supply but cloudy demand caps gains

13-11-2024 10:09 AM

Ammon News - Oil prices edged up on Wednesday on signs of near-term supply tightness but remained near their lowest in two weeks, a day after OPEC downgraded its forecast for global oil demand growth in 2024 and 2025.

Brent futures rose 17 cents, or 0.24%, to $72.06 a barrel by 0420 GMT, while U.S. West Texas Intermediate (WTI) crude futures gained 14 cents, or 0.21%, at $68.26.

"Crude oil prices edged higher as tightness in the physical market offset bearish sentiment on demand. Buyers in the physical market have been particularly active, with any available cargoes being snapped up quickly," ANZ analysts said in a note.

But falling demand projections and weakness in major consumer China continued to weigh on market sentiment.

"We may expect prices to consolidate around current levels for longer," said Yeap Jun Rong, market strategist at IG, adding the recent attempt for a bounce was quickly sold into.

"The absence of a more direct fiscal stimulus out of China has been casting a shadow on oil demand outlook, coupled with the prospects of higher US oil production with a Trump presidency and looming OPEC+'s plans for an output raise," Yeap added.

In its monthly report on Tuesday, the Organization of Petroleum Exporting Countries (OPEC) said world oil demand would rise by 1.82 million barrels per day (bpd) in 2024, down from growth of 1.93 million bpd forecast last month, mostly due to weakness in China, the world's biggest oil importer.

Oil prices settled up 0.1% on Tuesday following the news, after falling by about 5% during the two previous sessions.

OPEC also cut its 2025 global demand growth estimate to 1.54 million bpd from 1.64 million bpd.

Two U.S. central bankers said on Tuesday that interest rates are acting as a brake on inflation that is still above the 2% mark, suggesting that the Federal Reserve would be open to further interest rate cuts.

The Fed cut its policy rate last week by a quarter of a percentage point to the 4.50%-4.75% range. Interest rate cuts typically boost economic activity and energy demand.

Reuters

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