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Oil Prices
06-01-2020, 07:40 PM.
Post: #1241
RE: Oil Prices
Oil hits $70 a barrel as Iran, Trump trade threats
* Brent tops $70/bbl; WTI at highest since April.
* Iraqi govt calls on foreign troops to leave.
* Trump threatens sanctions on Iraq if U.S. troops forced to leave.
* U.S. will also take action if Iran strikes back, Trump says.

Reuters
PUBLISHED MON, JAN 6 20205:49 AM EST
UPDATED 44 MIN AGO

Oil prices rose a further 2% on Monday, pushing Brent above $70 a barrel, as rhetoric from the United States, Iran and Iraq fanned tensions in the Middle East after a U.S. air strike which killed a top Iranian military commander.

Brent crude futures soared to a high of $70.74 a barrel and was at $69.74 at 0940 GMT, up $1.14, or 1.66%, from Friday’s settlement.

U.S. West Texas Intermediate crude was at $63.92 a barrel, up 87 cents, or 1.38%, after touching $64.72, the highest since April.

The gains extended Friday’s more than 3% surge after a U.S. air strike in Iraq killed Iranian military commander Qassem Soleimani on Friday, heightening concerns about an escalation in conflict in the Middle East and the possible impact on oil supplies.

The region accounts for nearly half of the world’s oil production, while a fifth of the world’s oil shipments pass through the Strait of Hormuz.

On Sunday U.S. President Donald Trump threatened to impose sanctions on Iraq, the second largest producer among the Organization of the Petroleum Exporting Countries (OPEC), if U.S. troops were forced to withdraw from the country.

Baghdad earlier called on U.S. and other foreign troops to leave Iraq.

Trump also said that the United States would retaliate against Iran if Tehran were to strike back after the killing.

“The situation brings lots of uncertainty and geopolitical tea-leaf reading on reactions. While the closure of the Strait of Hormuz remains a very unlikely event, the deterioration in Iraq bears supply risks,” said Norbert Rucker, head of economics at Swiss bank Julius Baer.

“Geopolitics tend to be a temporary force on oil markets and we believe this time is no different. We raise our near-term forecast to $65 per barrel, and maintain a neutral view”.

Goldman Sachs analysts said the current risk premium embedded in Brent monthly price spreads is already elevated and an actual supply disruption is now necessary to sustain current oil prices.

“The precedent set by the Abqaiq attack (on Saudi oil facilities in September 2019) showed that the oil market has significant supply flexibility starting when Brent is at $70 a barrel, even before shale production needs to ramp up, suggesting only moderate upside from here, should an attack on oil assets actually occur,” the bank said.

More details in https://www.cnbc.com/2020/01/06/oil-mark...focus.html
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11-02-2020, 07:36 PM.
Post: #1242
RE: Oil Prices
Oil rises from 13-month low as new virus cases slow

Alex Lawler
FEBRUARY 11, 2020 / 9:28 AM

LONDON (Reuters) - Oil rose to $54 a barrel on Tuesday, recovering from a 13-month low as the number of new coronavirus cases slowed in China, easing some concerns about a lasting hit to oil demand.

The death toll climbed above 1,000 on Tuesday, while the number of new confirmed cases fell. The epidemic may peak in February and then plateau before easing, the Chinese government’s top medical adviser on the outbreak said.

Brent crude LCOc1 rose 82 cents to $54.09 a barrel by 1008 GMT. It fell to $53.11 on Monday, the lowest since January 2019. U.S. West Texas Intermediate CLc1 crude was up 72 cents at $50.29.

Investors remain wary that China’s oil demand could take a further hit if the coronavirus cannot be contained and if OPEC and its allies, known as OPEC+, fail to agree on further steps to support prices.

“Though oil is recovering again today, the lack of any coordinated action by OPEC+ means that oversupply concerns are likely to retain the upper hand,” said Eugen Weinberg, analyst at Commerzbank.

The virus is already denting demand in the world’s second-largest oil consumer. Chinese state refiners plan to cut as much as 940,000 barrels per day (bpd) - almost 1% of world demand - from their crude processing rates in February.

Oil rose alongside a rally in world equities, which resumed their rise towards record highs on Tuesday on hopes the virus is peaking. But some analysts said concerns about the virus and oil demand would likely resurface.

The rally “seems to be more of a technical retracement than a general belief that the epidemic has run its course,” Tamas Varga of oil broker PVM said.

The Organization of the Petroleum Exporting Countries (OPEC) and allies including Russia are restraining output by 1.7 million bpd in 2020 to support the market, and have been weighing a further curb to stem fallout from the virus.

An OPEC+ advisory panel proposed an additional cut of 600,000 bpd last week, but Russia has delayed delivering its official stance, frustrating some OPEC members.

More details in https://www.reuters.com/article/us-globa...SKBN20506H
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