Oil steadies after week of heavy losses

16 October 2015, News Wires – Oil prices steadied on Friday, snapping a week-long decline as investors closed positions at the end of a volatile week that saw prices slide nearly 10% on renewed signs a global supply glut was here to stay, Reuters reported.

oil barrel stack.oil priceBrent’s new front-month December contract was up $0.40 at $50.13 a barrel at 8:25am GMT. November Brent expired at $48.71 a barrel on Thursday, down $0.44 day on day, it said.

US crude’s front-month November contract traded $0.51 higher, or 1.1%, at $46.89 a barrel, according to the report.

“Investors holding short positions have already started to take profit ahead of the weekend after four days of decline,” Tamas Varga, oil analyst at London brokerage PVM Oil Associates, told the news wire.

Strong equities markets also supported gains as European shares extended a rally on Friday, buoyed by bullish Asian and US trading on positive US economic data, Reuters continued.

Despite Friday’s gains, WTI was set to make its steepest weekly loss in 10 weeks and Brent in eight weeks, after the International Energy Agency predicted the market to remain oversupplied through 2016.

“Even if crude prices go up now, we could be seeing Iranian crude coming back to the market, pushing it down again. I think downward movement is more likely for the rest of this year,” Daniel Ang, an investment analyst at Singapore-based Phillip Futures Pte Ltd, told the news wire.

Some investors pinned hopes on forecasts of falling US shale oil production, with output expected to drop the most on record in November, according to the US Energy Information Administration (EIA).

Data from the EIA also showed gasoline stocks fell by 2.6 million barrels last week, above analysts’ expectations for a 1.7-million barrel drop. Distillate stockpiles, which include diesel and heating oil, fell by 1.5 million barrels versus expectations for a 60,000-barrel drop.


  • Reuters
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