On August 18, oil prices gained as the stock market rebounded and the U.S dollar weakened, though U.S. crude futures stayed on track to close the week down, as investors are still concerned about the global oil surplus. The week’s trading was defined by bearish data over Chinese oil demand and increasing crude production in the U.S.
WTI crude CLc1 futures for September delivery increased $1.18 to $48.27 a barrel, a 2.5 percent increase. Brent crude LCOc1 futures for October delivery gained $1.40 to $52.43 a barrel, a 2.7 percent advance.
Brent prices traded at a high for the day of $52.57 and a low of $50.78 a barrel. About 218,987 lots of the front-month contract were traded by 16:15 GMT, almost 65.5 percent of the previous session’s volume.
“It’s following the equity markets, and impacted by the dollar,” stated Tariq Zahir, founding member at Tyche Capital Advisors.
Fundamentals for oil remain bearish as U.S. driving season nears an end, he cautioned. Both benchmarks are on pace to close the week lower, following bearish data earlier in the day.
“The main question is whether we will continue to see the kind of inventory draws that may show the supply-demand balance is tightening over the next few weeks,” quoted Gene McGillian, director of market research at Tradition Energy.
Nigeria’s crude oil exports are anticipated to drop to 1.72 million barrels per day (bpd) in October, loading programmes displayed on Friday.
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Indications of supply tightness have started surfacing in the United States, the world’s largest oil consumer.