24 November 2015, News Wires – Brent settled steady and US crude slightly lower on Monday after prices were whipsawed by volatility as Saudi Arabia pledged to work toward oil price stability but traders worried about a global supply glut and signs of rising US stockpiles.
But prices gave back gains on signs of a growing glut.
Market intelligence firm Genscape reported a build of 2.2 million barrels at the Cushing, Oklahoma delivery point for US crude futures for the week ended 20 November, traders who saw the data said.
Analysts polled by Reuters forecast that data would probably show crude inventories across the United States rose by 1.1 million barrels last week.
“The overarching concern in this market is the growing inventory levels for crude, and that doesn’t seem to be easing despite the strong refinery runs we’ve been having,” said Phil Flynn, analyst at the Price Futures Group in Chicago.
Brent futures settled up 17 cents at $45.83 a barrel.
US crude’s West Texas Intermediate (WTI) futures finished the session down 15 cents at $41.75.
The Saudi statement came as oil held barely above two-and-a-half-month lows, and was greeted with a mix of enthusiasm and skepticism. Despite similar pledges before, the Saudis and other big Opec producers have kept output high to maintain market share, and crude prices have halved over the past year. Opec’s next meeting on production targets is on 4 December.
US gasoline rose about 2%, settling up for a fourth straight day, while ULSD finished firm, helping shore up some sentiment in the petroleum complex. Traders bought those refined products amid strong demand for gasoline at pumps and colder weather in Northeastern United States, which should boost demand for heating oil, or ULSD.
Hedge funds and other big speculators have cut bullish wagers on WTI to the lowest since August, data from Friday showed.
Market participants also worried about the discount in nearby WTI versus farther-dated contracts, analysts said.
“The dramatic expansion in the WTI carrying charges since early last month will remain as a major bearish portent that will be keeping alive a test of the late August WTI lows,” said Jim Ritterbusch of Chicago-based oil consultancy Ritterbusch & Associates.
WTI’s front-month fell to $38.99 a barrel on Friday, trading barely above its 27 August low of $37.75.