Goldman Sachs warns oil prices on the brink of 'capitulation'

Saudi Energy Minister Khalid al Falih said on Monday that oil producers would

Higher crude output from the United States should limit any upside to global oil prices through the end of 2018, the U.S. government said on Tuesday, ahead of a meeting of major oil producers later this month to discuss extending supply cuts.

So the iPath S&P GSCI Crude Oil Total Return Index ETN (OIL), climbed 0.8%, extending yesterday's almost 4% surge, and the U.S. Oil Fund (USO) rose 0.9% to $9.94.

Reuters reported that OPEC and its non-OPEC partners were considering an extension to the current deal, which comprises an output cut of 1.8 million barrels per day (bpd), for nine months or more. Aramco had previously maintained supplies to important Asian customers.

Brent crude futures, the worldwide benchmark for oil prices, were at $49.33 per barrel at 0651 GMT on Tuesday, down from a high of $49.60 earlier in the day and near their last close.

But questions remain about the effectiveness of OPEC-led cuts, with OPEC member Libya saying production now exceeded 800,000 barrels per day (bpd) for the first time since 2014 and could rise to 1.2 million bpd later this year.

Oil prices have been under pressure of late, amid investor concerns the global supply glut is not receding as fast as expected.

The rebound in oil prices to around $50 in recent months breathed new life into US producers, who have boosted drilling in shale regions, lifting USA output to levels not seen since mid-2015.

More news: United States officials criticize Turkey after attack on DC protesters

Russian Federation also said it was discussing prolonging cuts with other producers beyond 2017.

International Brent crude futures were at $50.46 per barrel at 0438 GMT on Thursday, up 24 cents, or 0.5 per cent, from their last close. "This surprise increase in stockpiles, a barometer of the global oil market, casts doubts on the ability of the six months agreement to suffice", a spokesperson for consultancy Coface Group said.

In its monthly oil market report (MOMR), OPEC said the USA oil and gas companies have already stepped up activities in 2017 as they start to increase their spending amid a recovery in oil prices.

After talks, the buyer avoided a cut in June because of an earlier request for extra supplies, the source said.

News that the curbs may be extended into 2018 fuelled a short-lived rally in the market, but oil gave up the gains quickly amid pessimism on how long it will take to drain brimming oil inventories.

Bank of America Merrill Lynch said the low oil prices were also due to a slowdown in demand."Oil demand growth this year is underwhelming, in part explaining why crude oil prices and refining margins have sold off sharply recently", it said.

"I am still watching the US summer gasoline demand", said Kho, the president of Vitol Asia Pte.

Related News:



Most liked

Telecom sector disappointed with 18% GST rates
Almost 81 per cent of products under the GST would be charged below the 18 per cent bracket, said Revenue Secretary Hasmukh Adhia. The tax rates will be decided in a fashion to keep their impact on inflation as well as revenues to the government near neutral.

Mourinho: I hope Palace go soft on us
In De Gea's absence at St Mary's, Sergio Romero saved a penalty on his way to keeping a clean sheet. From Mourinho's perspective, some United players gave him food for thought ahead of the Ajax game.

Analysts' Ratings Review: Sirius XM Holdings I (NASDAQ:SIRI)
HighTower Advisors LLC increased its stake in shares of Sirius XM Holdings by 4.6% in the first quarter. If SIRI is undervalued and the market situation is in decline stage, it might be a good investment too.

Rod Beard's National Basketball Association mock draft 1.0
The timing was ideal for the Celtics, as Brooklyn finished with the worst record in the league. But the Celtics' choice is not important; L.A. got exactly what it needed this year.

Senate Expected to Give House Health Care Plan the Cold Shoulder
Collins also took issue with the bill's failure to adjust the size of its tax credits based on people's income or where they live. Collins, however, noted that the credits aren't adjusted for variations in income and geographic regions across the U.S.

Celtics Will Only Trade Top Pick For 'Second Coming'
Sacramento actually moved up into the top three, but the 76ers had the right to swap with them through terms of a past trade. While the Celtics and Lakers were the big winners, it wasn't just those franchises that had a lot at stake last night.

Sen. John Cornyn removes self from consideration for FBI director role
Mike Rogers as the only name still under official consideration with partisan political experience. Cornyn is one of 11 people under consideration by Trump to replace Comey.

Microsoft Points Finger at NSA in Ransomware Outbreak
Bkav recommends that all computer users immediately install updates and security patches and hotfixes via Windows Update. Hackers will sometimes encourage you to keep your computer on and linked to the network, but don't be fooled.

Tories shoot for the sewer on migration
Free school lunches for infants in England will be scrapped, but there will be free breakfasts across the primary aged pupils. The money saved by means-testing the winter fuel payment will go directly to fund health and social care.

Special Kane not for sale, vows Pochettino
Alan Curbishley believes Tottenham striker Harry Kane fools opponents with his quick-fire shooting. We spoke a lot to try to change that view and that feeling and finish in the best way.

White House calls Sally Yates a 'political opponent' of Trump
In her testimony, Yates said that she had called McGahn the Monday after they met to tell him the material was ready to review. During that period, Flynn accepted tens of thousands of dollars from a Russian state-sponsored television network.

Donald Trump says he fired James Comey because he was 'unpopular'
He also told network anchors at the White House on Thursday that appointing a special counsel "hurts the country". In a reported memo, Comey allegedly says Trump asked him to let the probe into Flynn go.

Russia says latest U.S. Syria strike hit civilians, was unacceptable - agencies
A US defence official said the convoy had not responded to numerous warnings that it was "getting too close to coalition forces". The convoy was hit on Thursday, May 18 as it neared a group of US -backed rebels and a Western special forces unit in Tanf.

Massachusetts adds jobs in April, but unemployment rises
Despite the weakness in April, the labor market is showing more signs of life with 101,000 full-time jobs added so far this year. The information sector, which includes technology and media, lost jobs, as did the finance and insurance industry.

83 gang members arrested in 5-state raid
Some of the defendants are connected to at least six homicides and five attempted homicides in North Carolina. The indictment also alleges illegal activity as far away as the Florida panhandle and the NY prison system.