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OIL AND GAS - LONDON. Oil prices pulled back from multi-year highs reached earlier in the day on Thursday as warnings grew that a 13 percent rally since early December was close to running its course.
Oil prices pulled back from multi-year highs reached earlier in the day on Thursday as warnings grew that a 13 percent rally since early December was close to running its course.
But on Thursday UAE oil minister and current OPEC President Suhail al-Mazrouei said he expects the market to balance in 2018 and that the producer group is committed to its supply reduction pact until the end of this year.
Production cuts led by the Organization of the Petroleum Exporting Countries (OPEC) and Russia, which started in January last year and are set to continue throughout 2018, have underpinned prices.
Ample Fuel
Still, downward pressure emerged in the physical market, where OPEC’s second and third-largest producers, Iran and Iraq, this week cut their prices to remain competitive.
Fuel inventories in Asia and the United States remain ample and in some cases are rising.
U.S. gasoline stocks climbed by a bigger than expected 4.1 million barrels, EIA data showed.
In Asia’s Singapore oil trading hub, average refinery profit margins have fallen below $6 a barrel, their lowest seasonal level in five years.
“Markets are getting a bit fatigued and a healthy correction could be on the cards,” said Stephen Innes, head of trading for Asia/Pacific at futures brokerage Oanda in Singapore.
