collected by :Jack Alex
The oil price has fallen back below the key $50 a barrel mark for the first time since November after surging US oil supplies dealt a blow to Opec’s plan to erode the global oversupply of crude.
The flagging oil price bounded above $50 a barrel late last year after a historic co-operation deal between the Organisation of Petroleum Exporting Countries and the world’s largest oil producers outside of the cartel to limit output for the first half of this year.
The November deal was the first action taken by the group to limit supply for over eight years but since then the quicker than expected return of fracking rigs across the US has punctured the buoyant market sentiment of recent months.
as informed in
US West Texas Intermediate (WTI) crude futures were up 30 cents at $48 a barrel.
Benchmark Brent crude futures were at $50.86 per barrel at 10.40am GMT, up 30 US cents from their last close.
In the US, shale drilling has pushed up oil production by more than 8% since mid-2016 to just above 9.1-million barrels per day.
Dennis Gartman, founder and editor of the Gartman Letter said the longer-term outlook was for continuing low oil prices.
Saudi Arabia said its crude exports to the US would fall by about 300,000 barrels per day between February and March, boosting price sentiment.
as informed in
Oil price forecasts continue to fall
Long-Term Outlook“Super-high oil prices financed the oil industry to seek new supply,” Paul Sankey, senior oil and gas analyst at Wolfe Research LLC, said in a note to clients.
Societe Generale SA revised its price forecast “moderately higher” than a previous forecast, though its estimate remains more moderate than Tudor’s.
The French bank expects OPEC will continue to extend production cuts into the second half of the year, according to a note led by Michael Haigh.
It’s hard to maintain a bullish posture here.”For the second half of 2017, Tudor reduced its price estimate by $10 to $62.50.
“The industry has responded aggressively, so that the long-term outlook for oil prices is lower.”Still, analysts remain relatively positive in their comments.