Digital Resource World News – Urandir News-

    Oil tumbles as stockpile worry overshadows rally
A female employee fills the tank of a car at a petrol station in Cairo, Egypt, February 24, 2016.

Reuters/Mohamed Abd El Ghany


Global oil prices fell as much as 4 percent on Monday on concerns a six-week market recovery has gone beyond fundamentals, as U.S. crude stockpiles continue to mount and Iran maintains little interest in a global production freeze.

Market intelligence firm Genscape reported an inventory build of 585,854 barrels in Cushing, Oklahoma, taking the delivery hub for U.S. crude futures closer to capacity, traders who saw the data said.

The Organization of the Petroleum Exporting Countries said global demand for crude from its members, including Saudi Arabia, Iraq and Iran, will be less than previously thought in 2016 due to competing non-OPEC supply. OPEC supply will likely exceed demand by about 760,000 barrels per day, up from 720,000 bpd implied earlier, it said.

Russia said OPEC’s meeting on a production freeze with other key oil producers like itself will probably be held in Doha in next month. It said Iran supports the plan, although Tehran was keen to restore its crude exports first to pre-sanction levels.

Investment bank Morgan Stanley predicted a $25-$45 trading range for U.S. crude in an oversupplied but volatile market, concurring with several analysts’ views.

“We feel that the bulk of this stronger than expected 5-6 week price advance has been seen and that prices will be shifting into a near term consolidation phase,” said Jim Ritterbusch of Chicago energy consultancy Ritterbusch & Associates.

U.S. crude CLc1 was down $1.65, or 4.3 percent, at $36.85 a barrel by 12:18 p.m. EDT. It hit a three-month high of $39.02 on Friday, surging from a 12-year low of $26.05 a month earlier.

Brent LCOc1 was down $1.20, or 2.9 percent, at $39.19 barrel. The global crude benchmark fell to a 2003 low of $27.10 in late January.

Monday’s price tumble came after last week’s rally of 7 percent in U.S. crude, which was up for a fourth straight week. Brent gained 4 percent last week, up for a third week in a row.

Some analysts expect a more bearish supply-demand picture when the U.S. government issues weekly oil data on Wednesday. Last week’s report showed a crude build of nearly 4 million barrels to above 521 million barrels, the fourth straight week of growing to record highs.

“I think as we approach $40 for WTI and Brent, the market will not like a net build of more than 2 million barrels this week,” said Scott Shelton, energy broker at ICAP in Durham, North Carolina.

Money managers, including hedge funds, raised their bullish bets on U.S. crude for a third week in a row to November highs but cut net long positions in Brent.

(Additional reporting by Karolin Schaps in LONDON and Henning Gloystein in SINGAPORE; Editing by Marguerita Choy and W Simon)

digital resource wold news- Urandir Notícias
sources:

Original article by reuters.com
updated by DR News