Sun, Apr 15, 2018 - Page 14 News List

Oil has its biggest weekly gain since July amid tensions

Bloomberg

Crude on Friday posted its largest weekly gain since July last year as geopolitical tensions threatened to accelerate the tightening of global supplies.

Futures rallied for a fifth day to the highest since 2014 in New York.

The US benchmark crude ended the week up 8.6 percent amid simmering disputes across the Middle East, home to almost half the world’s oil.

OPEC’s output has fallen to the lowest level in almost three years, propelled in part by the magnitude of Venezuela’s downward spiral.

“We’re continuing to get a bit of a risk premium here from potential issues in the Middle East,” Toronto-based TD Securities head of global commodity strategy Bart Melek said. “There’s a general consensus out there that this market is rebalancing.”

Oil in New York and London jumped this week as missiles flew on the Arabian Peninsula and US President Donald Trump threatened punishment for a chemical attack on civilians in Syria.

At the same time, OPEC is probably on the verge of erasing a worldwide crude glut, the International Energy Agency said on Friday.

“The tensions around what the US response to Syria is going to be” are elevating risks, Stratas Advisors LLC lead oil analyst Ashley Petersen said in New York. “It really does have the ability to escalate quickly.”

West Texas Intermediate for delivery next month advanced US$0.32 to settle at US$67.39 per barrel on the New York Mercantile Exchange. Total volume traded was about 14 percent greater than the 100-day average.

Brent for June settlement climbed US$0.56 to end the session at US$72.58 on the London-based ICE Futures Europe exchange, the highest since November 2014. The global benchmark crude traded at a US$5.25 premium to June West Texas Intermediate.

Hedge funds boosted net-bullish Brent crude oil bets to a record, weekly ICE Futures Europe data on futures and options showed.

Yuan-denominated futures for September delivery on Friday gained 0.4 percent to 426.1 yuan per barrel on the Shanghai International Energy Exchange.

Less than 10 percent of the oil inventories surplus remains after OPEC and its partners curbed production by even more than they intended while world demand climbed, the International Energy Administration said on Friday.

Gasoline futures rose 0.5 percent to settle at US$2.0654 per gallon.

Natural gas rose US$0.05 to US$2.74 per 1,000 cubic feet, heating oil gained US$0.02 to US$2.10 per gallon and wholesale gasoline added US$0.01 to US$2.07 per gallon.

Additional reporting by AP

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