Asian markets ease as oil prices struggle

HONG KONG, China—Most Asian markets dipped Thursday, with energy firms struggling after another sell-off in oil fuelled by concerns about a planned output cut.

Crude prices are slumbering at three-month lows after OPEC member Iraq and non-member Russia suggested this week they would not take part in any limitations, despite a painful global supply glut.

Their comments have raised questions about the viability of a last month’s agreement at oil cartel OPEC to reduce output, which sent prices soaring.

Both main contracts have tumbled more than three percent this week and news that US stockpiles had fallen more than expected last week was unable to provide any support.

“Iraqi demands to join the list of countries exempted from quotas have simply added to the uncertainty” that an output cut can be implemented, Research firm Capital Economics said in a commentary.

“We have long been sceptical of the chances of a game-changing deal and continue to forecast that both Brent and WTI will end the year back at around $45 per barrel.”

Regional energy firms extended recent losses. Hong Kong-listed CNOOC sank more than three percent, with traders also selling on the back of a weak earnings report.

PetroChina lost 1.5 percent in Hong Kong, while Sydney-listed Woodside Petroleum was 1.5 percent off and Santos lost one percent.

Among regional markets Tokyo ended the morning down 0.3 percent, Hong Kong shed 0.9 percent—extending a one percent loss Wednesday—and Shanghai slipped 0.2 percent.

Seoul, however, added 0.2 percent, boosted by market heavyweight Samsung Electronics’ two percent surge.

The firm confirmed a 30 percent plunge in third-quarter operating profit linked to its Galaxy Note 7 crisis but later announced its heir apparent JY Lee had joined the board, putting him a step towards control of the family-run conglomerate.

Lee Chaiwon, chief investment officer at Korea Value Asset Management said JY’s bigger role should provide a much-needed boost to the under-fire company, saying it “will become more market-friendly and will “quicken its restructuring process”.

The dollar rose against the pound, euro and other high-yielding currencies as a preliminary survey showing the key US services sector expanded in October reinforced expectations the Federal Reserve will lift interest rates before the end of the year.

Key figures around 0230 GMT

Tokyo – Nikkei 225: DOWN 0.3 percent at 17,341.23 (break)

Hong Kong – Hang Seng: DOWN 0.9 percent at 23,105.12

Shanghai – Composite: DOWN 0.2 percent at 3109.37

Euro/dollar: DOWN to $1.0897 from $1.0907 Wednesday

Dollar/yen: DOWN to 104.44 yen from 104.51 yen

Pound/dollar: DOWN to $1.2214 from $1.2242

Euro/pound: UP to 89.19 pence from 89.09 pence

Oil – West Texas Intermediate: Flat at $49.18 a barrel

Oil – Brent North Sea: DOWN four cents at $49.94

New York – Dow: UP 0.2 percent to 18,199.33 (close)

London – FTSE 100: DOWN 0.9 percent at 6,958.09 (close)

source: business.inquirer.net

Oil prices down as OPEC meeting awaited

NEW YORK, United States—Oil prices fell slightly on world markets on Tuesday, with investors taking profits after consecutive rises in recent days.

A barrel of West Texas Intermediate for September delivery fell 25 cents to $42.77 on the New York Mercantile Exchange, after having risen nearly a dollar and a half the day before.

In London, a barrel of North Sea Brent for October delivery fell 41 cents to $44.98 on the Intercontinental Exchange.

The slight declines followed Monday’s announcement of an unscheduled meeting next month by the Organization of Petroleum Exporting Countries, fueling speculation of measures to stabilize prices.

Russian Energy Minister Alexander Novak reportedly said his country would be willing to discuss a freeze if OPEC raises the matter.

After a bearish July, prices rebounded in recent days, following stronger-than-expected US hiring figures and a general reevaluation of the likelihood of a US interest rate hike.

“It’s quiet today. I think you may see a bit of profit taking,” said John Kilduff of Again Capital.

“This is a short-covering rally with record short interest in crude oil,” Kilduff said, adding that rumor of possible collaboration between Russia and OPEC was also influencing market decisions.

source: business.inquirer.net

Oil steadies near $58 as US rig count offsets Chinese data

LONDON - Brent crude prices steadied near $58 a barrel on Monday as falling U.S. oil rig counts and signs of healthy U.S. growth offset concerns over the strength of the Chinese economy.

China's trade performance slumped in January, pointing to lower fuel demand in the world's biggest energy consumer. Exports fell 3.3 percent from a year earlier while imports tumbled 19.9 percent, highlighting a deepening slowdown.

But the falling number of U.S. oil rigs, at its lowest since December 2011, reduced the impact of the Chinese data on oil prices, which have dropped more than 50 percent since June.

Stronger-than-expected growth in U.S. jobs in January also helped support oil, as non-farm payrolls increased 257,000, outstripping Wall Street forecasts.

Global benchmark Brent crude oil LCOc1 for March was up 10 cents at $57.90 a barrel by 1118 GMT (06:18 a.m. EST) after rising as high as $59.06 earlier in the session. U.S. crude CLc1 was up 56 cents at $52.25 a barrel, having hit a session high of $53.40.

While signs of an economic slowdown in China depressed the market, analysts said crude import figures remained high and the disappointing data was unlikely to derail a rally in oil prices.

"I think we'll get a bit of a pullback. But will it send prices back to the lows? I'm not convinced about that," said Michael Hewson, chief market analyst at CMC Markets.

"We've had such a strong decline that some sort of bounce back is inevitable."

Brent rose more than 9 percent last week, its biggest weekly rise since February 2011. The North Sea oil futures contract has climbed more than 18 percent in the past two weeks, its strongest showing since 1998.

"It's still the same pattern," said Carsten Fritsch, senior oil and commodities analyst at Commerzbank in Frankfurt. "Markets are ignoring the bearish news and rather trade on the bullish news."

Preliminary Chinese January customs data came in at 27.22 million tonnes of crude imports, though estimates from Thomson Reuters Research and Forecasts put the final figure at about 30 million tonnes.

Reuters technical analyst Wang Tao said crude charts suggested the increase in prices may have ended for a while.

"I prefer a bearish bias," Wang Tao told Reuters Global Oil Forum. "Both WTI and Brent may correct in this week before seeking their next direction."  — Reuters