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Oil slips but set to end week steady on tight supply

Jumat, 23 Juli 2021 / 22:28 WIB
Oil slips but set to end week steady on tight supply
ILUSTRASI. The sun sets behind a crude oil pump jack on a drill pad in the Permian Basin in Loving County, Texas, U.S. . REUTERS/Angus Mordant/File Photo

Sumber: Reuters | Editor: Herlina Kartika Dewi

KONTAN.CO.ID - NEW YORK. Oil prices fell on Friday but was on track to end the week little changed after a strong recovery from Monday's steep slide, underpinned by expectations that supply will remain tight through the year.

The price of oil and other riskier assets tumbled at the start of the week on concern over the impact on the economy and crude demand from surging cases of the COVID-19 Delta variant in the United States, Britain, Japan and elsewhere.

Brent crude was down 24 cents, or 0.3%, at $73.55 a barrel by 10:53 a.m. (1453 GMT) after jumping 2.2% on Thursday. U.S. West Texas Intermediate (WTI) crude dropped 28cents, or 0.4%, to $71.63, having gained 2.3% on Thursday.

Brent and U.S. crude futures were set to end the week little changed, having declined in the previous two weeks.

"The demand concerns proved to be exaggerated, which is why oil prices have since recovered. Despite the expansion in oil supply, the oil market will remain slightly undersupplied until the end of the year," Commerzbank said in a note.

Both contracts fell about 7% on Monday but have recouped all of those losses, with investors expecting demand to stay strong and the market to receive support from falling oil stockpiles and rising vaccination rates.

Baca Juga: Oil up as demand recovery seen tightening supply

Demand growth is expected to outpace supply after Sunday's deal between the Organization of the Petroleum Exporting Countries (OPEC) and allies, collectively known as OPEC+, to add back 400,000 barrels per day (bpd) each month from August.

ANZ Research analysts said in a report that the market was starting to sense the 400,000 bpd increase will not be enough to keep the market balanced and inventories in the United States and across OECD countries would continue to fall.

U.S. crude inventories rose by 2.1 million barrels last week, but stocks at the Cushing, Oklahoma delivery point for U.S. crude hit their lowest since January 2020.

"We still think the OPEC+ driven dip in crude and distillate prices is a buying opportunity and project Brent will hit $100/barrel next year, with distillates tagging along for the ride," Bank of America said in a note. 

Selanjutnya: Oil climbs over 4% despite rise in U.S. inventories



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