Published: Mon, April 09, 2018
Markets | By Erika Turner

Oil Prices Rise as US Drilling Slows

Oil Prices Rise as US Drilling Slows

Oil prices were modestly higher on Thursday, helped by gains in US equities markets as trade tensions between China and the United States eased, but the advance was limited by strength in the dollar.S.

"There is speculation that the Saudis are going to lower prices for their Asian customers", said Bob Yawger, director of energy futures at Mizuho in NY. Official data from the Energy Information Administration (EIA) will be released later today.

"But increasing trade friction between China and the United States is likely to rock global markets and tarnish bullish sentiment in crude oil markets".

Brent hit a session low of $66.69 and USA crude slumped as low as $62.06.

"The two countries are using discretion in their actions, and it does not look like the situation is developing into a full-scale trade war yet", said Tomomichi Akuta, senior economist at Mitsubishi UFJ Research and Consulting in Tokyo.

At 425.3 million barrels, US crude oil inventories are in the lower half of the average range for this time of the year.

First Alert Weather: Changes for the weekend as a system moves in
Throughout today southerly winds will increase along with moisture, and there is a chance for isolated showers and thunderstorms. Temperatures ahead of the front stays warm in the mid 70s with cooler conditions by Saturday afternoon and into Sunday .

With the group reaching an unprecedented degree of compliance with its current output target, Venezuela contributed to a further decline in supplies in March.

The West Texas Intermediate for May delivery dropped 1.93 US dollars to settle at 63.01 dollars a barrel on the New York Mercantile Exchange, while Brent crude for June delivery lost 1.70 dollars to close at 67.64 dollars a barrel on the London ICE Futures Exchange. The more-active June contract rose 58 cents to settle at $69.34.

Brent crude, the global benchmark, was down 1.7% at $66.98 a barrel on London's Intercontinental Exchange. Prices slipped 10 cents, or 0.2 percent, to $68.02 Wednesday. Shanghai trading will resume on Monday. Distillate stockpiles, which include diesel and heating oil, rose by 537,000 barrels, versus expectations for a 1.1 million barrels drop.

China suspended tariff concessions on 128 items of US products including pork and fruits starting Monday, according to the Ministry of Finance.

China slapped extra tariffs of up to 25 percent on 128 USA products including frozen pork, as well as wine and certain fruits and nuts, in response to US duties on imports of aluminium and steel, the country's finance ministry said on Sunday night.

On Thursday Trump said he was asking the United States Trade Representative to consider $100 billion more in tariffs as a retaliation against China.

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