Crude settles at 8-week highs on signs the market is rebalancing
Investing.com
Published Jul 27, 2017 02:35PM ET
Investing.com – Crude futures settled higher on Thursday, as investors continue to cheer signs that rising demand will offset excess supplies in the second half of the year amid a larger-than-expected draw in U.S. supplies.
On the New York Mercantile Exchange crude futures for September delivery rose 0.61% to settle at $49.04 a barrel, while on London's Intercontinental Exchange, Brent added 1.10% to trade at $51.53 a barrel.
Crude advanced to eight-week highs on Thursday, as investor expectations grew that U.S. crude supplies would continue to drop during the second half of the year, easing the global glut in supply.
The Energy Information Administration (EIA) reported Wednesday, crude and gasoline stockpiles fell by more than expected last week, pointing to an uptick in demand for crude and refinery activity.
Inventories of U.S. crude fell by roughly 7.2m barrels in the week ended July 14, confounding expectations of a draw of about only 2.6m barrels while gasoline inventories, one of the products that crude is refined into, fell by roughly 1m.
Crude prices remained on track to post a weekly gain amid an uptick in sentiment on oil, following news that Saudi Arabia plans to lower crude exports to 6.6 million barrels per day (bpd) in August, almost 1 million bpd below the level last year.
Rising U.S. oil production, however, is expected to limit upside momentum in oil prices, offsetting positive impact of falling U.S. crude stockpiles which has pushed crude prices near the key $50 a barrel level.
“The near-term trend of falling oil stocks is helping fuel a rally in the energy space; however, the trend of rising U.S. oil production remains relentless,” said Tyler Richey, co-editor of the Sevens Report.
“Until that trend begins to show signs of slowing, the upside gains in the energy market will be limited,” he said.
Get The News You Want
Written By: Investing.com
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.