Oil prices tumble in Asia

SINGAPORE – Oil prices resumed their downward spiral in Asian trade Thursday following another massive sell-off in equities as traders grow increasingly concerned about the global economic outlook, analysts said.

US benchmark West Texas Intermediate (WTI) for November delivery fell 90 cents to a two-year low of $80.88 a barrel in late-morning trade. Brent crude for November retreated 43 cents to $83.35, levels last seen four years ago.

Both contracts have lost more than a fifth of their value since hitting 2014 highs in June.

Markets across Asia sank on Thursday, led by Tokyo, as a disappointing set of US data fanned worries that the effects of a slowdown in China, Europe and Japan are being felt in the world's top economy.

Traders took their lead from New York and Europe, where stocks and the dollar sank.

"WTI and Brent continued to open in red," Phillip Futures said in a market commentary. "With the current bearish conditions for crude oil, we expect this to continue," it said.

A rebound in Asian trade Wednesday failed to gain traction as it was overwhelmed by negative sentiment in the face of waning demand in China, the world's biggest energy consumer, and the eurozone.

Adding to the pain is a supply glut caused by strong US production of shale gas and a return of Libyan oil on to the market after facilities that were closed due to civil unrest resumed operations.

Members of the Organization of the Petroleum Exporting Countries (OPEC) are also maintaining output levels, while slashing prices to gain market share, analysts said.

Investors are awaiting the release later Thursday of weekly US crude inventories -- a closely watched barometer of demand and supply in the world's top oil consuming nation.

Phillip Futures said it expects prices for the US-centric WTI contract to remain supported at $80 for the rest of the day, but it was harder to plot a floor for Brent, which is more linked to the international market. – Agence France-Presse

source: gmanetwork.com

Oil prices mixed, eyes on Ukraine crisis

SINGAPORE – Oil prices were mixed in Asian trade Tuesday as investors cautiously watch events in Ukraine, with western powers threatening sanctions against Russia for its military intervention in the region.

The United States said it has suspended defense cooperation with Russia and the UN Security Council began a meeting on the crisis.

US benchmark West Texas Intermediate (WTI) for April delivery, eased 13 cents to $104.79 in mid-morning trade on profit-taking as after hitting its highest levels this year in New York on Monday.

Brent North Sea crude for April climbed two cents to $111.22.

Producing more than 10 million barrels a day in January, Russia vies with Saudi Arabia as the world's largest crude oil producer, and is the second-largest producer of natural gas.

More than 70 percent of its gas and oil exports to Europe pass through Ukraine.

"The Ukraine event is a new catalyst that propped up crude oil prices to form new highs," Phillip Futures said in a market commentary.

"When war erupts, Russia, one of the world's top oil producers, is likely to reduce oil exports due to higher domestic consumption."

It warned that any possible disruption to oil infrastructure could hit production, leading to tighter supplies.

Research house Capital Economics noted that "Europe is heavily dependent on supplies of Russian energy."

Ukraine on Monday accused Russia of pouring more troops into Crimea as world leaders grappled with Europe's worst crisis since the Cold War and global stock markets tumbled on fears of an all-out conflict.

Crimea has been under de facto occupation by Moscow-backed forces since President Vladimir Putin won parliament's authorization on Saturday to send troops into Ukraine. – Agence France-Presse

source: gmanetwork.com

Oil prices up in Asian trade

Singapore – Oil prices edged higher in quiet Asian trade Tuesday as dealers hunted bargains while keeping an eye on a supply glut in the United States, analysts said.

New York's main contract West Texas Intermediate (WTI) for December delivery gained four cents to $94.66 a barrel in mid-morning Asian trade, while Brent North Sea crude for December climbed nine cents to $106.32.

"Prices are relatively muted," Teoh Say Hwa, head of investment at Phillip Futures in Singapore, told AFP.

"The minimal movement could be due to investors staying on the sidelines before the release of the weekly EIA (Energy Information Administration) report which would give them more directions relating to the US stockpiles," she said.

Crude inventories in the United States have climbed for the past six weeks, to about 28 million barrels, raising concerns about oversupply in the world's largest economy and top crude consumer.

WTI is trading below the $95 threshold after falling for four consecutive sessions last week under pressure from the build up in crude stockpiles, before rising slightly on Monday.

The EIA will release its weekly inventory report on Wednesday.

Libyan oil production levels also remain in focus, analysts said. The Libyan state oil company said Monday that protesters had maintained their blockade of the main oil facilities in the country, where production has fallen 80 percent since July.

Mohamed al-Harairi, an official at the National Oil Corporation, told AFP exports from Al-Hariga terminal in eastern Libya, which the government had said would resume by Monday, had not gone ahead for logistical reasons.

Protesters demanding jobs have been blocking terminals since late July, causing around $13 billion in losses to Libya's oil-dependent economy, authorities say. – Agence France-Presse

source: gmanetwork.com

Oil rebounds on breakthrough hopes in US budget crisis

Singapore – Oil prices rebounded in Asian trade Thursday on hopes of a possible breakthrough in the US budget crisis after the White House moved to convene meetings with leading members of Congress.

New York's main contract, West Texas Intermediate for delivery in November, was up seven cents at $101.68 in mid-morning trade while Brent North Sea crude for November gained seven cents to $109.13.

WTI declined $1.88 and Brent fell $1.10 New York Wednesday after the latest US crude stockpiles report showed a surprise build-up of 6.8 million barrels, but analysts said developments in Washington remain the main focus.

There are "continued concerns regarding the US budget impasse that would reduce demand for oil in the world's largest oil consumer," said Vanessa Tan, investment analyst at Phillip Futures in Singapore.

President Barack Obama sat down with House of Representatives Democrats on Wednesday, and invited all other lawmakers to the White House to work through budget disagreements that have led to the partial shutdown of the government.

Scenarios for an exit to the shutdown include a short-term government funding bill and a temporary debt ceiling rise, but there have no been consensus on any of these so far.

Failure to lift the debt ceiling by a October 17 deadline will mean the government is unable to pay its bills or service its debts, causing a default that analysts have warned could send the world economy back into recession.

"There is still no clarity as to whether the White House and the Republicans are closer towards a compromise that could result in a continuing resolution or a decision to lift the federal debt ceiling," DBS Bank said in a note.

"For now, a continuing resolution looks more likely if the both parties can move away from (Republican demands to cut Obama's health care law) and work towards spending cuts," it said. – Agence France-Presse

source: gmanetwork.com