Oil settles positively near 6-month high, despite dollar's rise

Economies.com
2019-04-23 04:16AM UTC

Crude oil futures fluctuated higher in a tight range during the Asian session to stabilize near near six-month high, ignoring the positive stability of the dollar index in spite of the inverse relationship between them, on the threshold of developments and economic data expected today, Tuesday by the US economy, the largest producer and consumer of the oil globally.

 

As of 03:44 GMT, Nymex crude futures (June 15th delivery) rose 0.29% to trade at $65.87 per barrel compared to the opening at $65.75 a barrel. Brent crude futures (June 15th delivery) rose 0.32% to trade at $74.36 per barrel compared to the opening at $72.20 per barrel, amid the rise of the US dollar index by 0.03% to 97.31 compared to the opening at 97.28.

 

Investors are looking for the US economy to release the Housing Price Index, which may reflect a stable 0.4% growth, unchanged from January, while the new home sales index may drop 3.0% to 647,000 versus 4.9% at 667,000 in February, in conjunction with the Chicago PMI reading, which may show a 10-month widening stability.

 

US Secretary of State, Mike Pompeo, said that the United States had made its demands clear for Iran and that his country's discussions with its partners in the past few days had been about providing alternative offers, explaining Washington's intention to apply its economic sanctions without any exceptions to Tehran by next month. Adding that the Kingdom of Saudi Arabia and the United Arab Emirates in addition to his country will ensure stablity and balance in oil supplies.

 

In the same context, US Secretary of State, Pompeo, noted that the United States will let Saudi Arabia and the United Arab Emirates to clarify the details of the oil supply. This came before the US President, Donald Trump, comments that Saudi Arabia and other countries in the Organization of OPEC will compensate more than the potential deficit due to US economic sanctions against Iran.

 

In another context, Saudi Oil Minister, Eng. Khalid Al-Falih commented on the US decision about not extending the waivers for China, India, South Korea, Japan, Turkey, Italy, Taiwan and Greece from its economic sanctions against the Iranian oil importers. That his country will be discussing with other countries and producers in the upcoming weeks to work on the balance and stability of oil markets amid work to ensure the stability of oil supplies in global markets.

 

The Libyan capital, Tripoli, suffered a series of air raids and bombings over the weekend, which also boosted oil prices earlier this week with concerns over the supply by one of OPEC's main oil exporters, with Libyan Military Marshal, Khalifa Hafater, directing his forces from the east of the country -which controls- to the capital, which is under the control of the government recognized by the United Nations.

 

We have also covered over the weekend, the disrupt of a major pipeline in Nigeria, one of the oil-exporting countries, which helped the Nymex crude to complete its gains for the eighth week in a row, the longest weekly rallies since the second quarter of 2015 and helped the Brent crude to complete its gains for the fifth consecutive week, marking its longest weekly gain streak since the last quarter of 2017.

 

We'd like to note that the official data we followed earlier this week by Saudi Arabia, the world's third-largest oil producer, OPEC's largest oil producer and the world's largest oil exporter and OPEC, showed that the Kingdom's exports dropped to 6.977 million barrels per day in February. Compared to 7.254 million barrels per day in January, which is also one of the factors that boosted the markets' concern about the oil supply.

 

According to the weekly report of "Baker Hughes", which was revealed last Thursday, due to the absence of the US market on Friday due to the "Good Friday" holiday, showed a decline of drilling rigs and platforms and oil exploration in the United States by 8 platforms to a total of 825 platforms during the week ending on April 19th, as the US oil production has recently stabilized at its peak of 12.1 million barrel per day.

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