December 5, 2021

The World Stock Markets Tips & Targets, News, Views & Updates

The World Stock Markets Tips & Targets, News, Views & Updates

Oil prices slip over 1% amid concerns over global supply surplus in Q1

slid more than 1% on Friday on concerns that a global supply surplus could swell in the first quarter following a coordinated release of crude reserves among major consumers, led by the United States.

Brent crude futures extended declines for a third session, falling 96 cents, or 1.2%, to $81.26 a barrel by 0130 GMT. U.S. West Texas Intermediate (WTI) crude was down $1.35, or 1.7%, at $77.04 a barrel. There was no settlement for WTI on Thursday because of Thanksgiving holiday.

U.S. President Joe Biden’s administration announced plans on Tuesday to release millions of barrels of oil from strategic reserves in coordination with other large consuming nations, including China, India and Japan, to try to cool prices.

Such a release is likely to swell supplies in coming months, an OPEC source said, according to the findings of a panel of experts that advises ministers of the Organization of the Petroleum Exporting Countries (OPEC).

The Economic Commission Board (ECB) expects a 400,000 barrels-per-day (bpd) surplus in December, expanding to 2.3 million bpd in January and 3.7 million bpd in February if consumer nations go ahead with the release, the OPEC source said.

Forecasts of rising surplus oil clouds the outlook of the meeting between OPEC and allies, a group known as OPEC+, on Dec. 2 to decide on immediate production. The group is to decide whether it will continue raising output by 400,000 bpd in January.

Still, the benchmark contracts are set to post their first weekly gain in nearly a month as the overall volume of the crude reserve release estimated at 70 million to 80 million barrels was smaller than market participants expected.

“Since the volume is small, I think it is aimed at easing tightness in supply, rather than having a big impact on oil markets,” Tsutomu Sugimori, president of the Petroleum Association of Japan (PAJ), told reporters late on Thursday.

 

(Reporting by Florence Tan; Editing by Christopher Cushing)

(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)

Dear Reader,

Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.
We, however, have a request.

As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.

Support quality journalism and subscribe to Business Standard.

Digital Editor

Share This :