A Review of the Nigerian Energy Industry

Oil dips slightly in early trade

Oil prices dip further.
Oil prices dip further.

29 October 2015 – Crude futures held on to strong gains in early Asian trading on Thursday, after the US Federal Reserve kept rates unchanged and a weekly government report on oil stockpiles showed an inventory build that was within expectations.

US and global oil benchmarks were little changed, having jumped on Wednesday after the government report on inventory build.

US crude futures were down 12 cents at $45.82 a barrel early on Thursday. They rose more than 6% on Wednesday, snapping three days of losses.

Brent crude was down 13 cents at $48.92 a barrel, after rising nearly 5% in the previous session.

“It looks like there was a lot of momentum in last night’s move so I would not be surprised to see it continue when the European and US sessions open up,” said Ric Spooner, chief market analyst at CMC Markets in Sydney.

US crude stocks rose last week, while gasoline and distillate inventories fell more than expected, data from the Energy Information Administration showed on Wednesday.

Inventories climbed in line with trader expectations but the buildup was less than the 4.1 million barrel increase reported by industry group, the American Petroleum Institute, a day earlier.

Stockpiles at the Cushing, Oklahoma delivery hub for US futures fell 785,000 barrels, giving a bullish tone to the report. Gasoline and distillate inventories also dropped more than expected.

The US Federal Reserve kept interest rates unchanged on Wednesday and in a direct reference to its next policy meeting put a December rate hike firmly in play. Investors had expected the Fed to remain pat on rates, but the overt reference to December came as a surprise.

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