Oil falls after Alwaleed comments
Published Jul 28, 2013 08:38PM ET
On the New York Mercantile Exchange, light, sweet crude futures for September delivery fell 0.14% to USD104.56 per barrel in Asian trading Monday after Friday’s session at a two-and-a-half week low. For the week, NYMEX-traded oil futures slid 3.24%.
Mixed economic data points out of the U.S., the world’s largest oil consumer, weighed on crude last week. In U.S. economic news out last Friday, the Thomson Reuters/University of Michigan final index of consumer sentiment for July rose to 85.1 from 84.1 last month. Economists expected a July reading of 84. The initial July reading was 83.9
Last Thursday, the U.S. Labor Department said initial claims for jobless benefits rose by 7,000 to 343,000 last week. Economists expected a reading of 340,000 new claims. The unemployment rate among people eligible for benefits dropped to 2.3 percent in the week ended July 13 from 2.4 percent the prior week, according to Bloomberg.
In a letter posted on Twitter Sunday, Alwaleed said Saudi Arabia, the largest producer in the Organization of Petroleum Exporting Countries, will not be able to boost production to 15 million barrels per day as previously hoped because of new supply coming to market from outside OPEC.
"We disagree with your excellency on what you said and we see that raising North American shale gas production is an inevitable threat," said Alwaleed in the letter.
Saudi Arabia is currently pumping well below its output capacity because of slack import demand. Oil revenue is expected to account for 92% of the kingdom’s government revenue this year. In his letter, the prince pressed King Abdullah to diversify the country’s revenue sources.
Elsewhere, Brent futures for September delivery rose 0.16% to USD107.28 per barrel on the ICE Futures Exchange.
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