Email Facebook Twitter

Tech company Mporium delivers an outstanding set of Q1 results says CEO De Groot
IronRidge Resources CEO hails spectacular lithium project and money making potential for gold

UK Money News

UPDATE 3-Oil pauses; focus on future supply direction

Mon, 15th Apr 2019 04:01

(Updates prices, add quotes)

By Aaron Sheldrick and Dmitry Zhdannikov

TOKYO/LONDON, April 15 (Reuters) - Oil prices halted their rally on Monday with Brent futures falling below $71 per barrel on signals that Russia may exit production cuts.

Losses were limited by a tightening of global supplies, as output has fallen in Iran and Venezuela amid signs the United States will further toughen sanctions on those two OPEC producers.

Brent crude futures were at $70.95 a barrel at 1050 GMT, down 60 cents, or 0.85 percent, having hit their highest since Nov. 12 on Friday at $71.87.

U.S. West Texas Intermediate crude futures were at $63.30 per barrel, down 59 cents or 0.93 percent.

"I would expect oil to trade in a relatively tight band around $70 for the time being," said Virendra Chauhan, oil analyst at Energy Aspects in Singapore, pointing to differing signs from the United States and OPEC on future supply.

"Leading edge indicators on U.S. supply suggest activity levels are stepping up, which is supportive for strong production growth in the second half," Chauhan said.

But at the same time, "murmurings from various ministers of the OPEC+ pact suggest supply from the group will not be ramped up pre-emptively as per last summer," he said.

The Organization of the Petroleum Exporting Countries and its allies meet in June to decide whether to continue withholding supply. OPEC, Russia and other producers are reducing output by 1.2 million barrels per day from Jan. 1 for six months.

OPEC's de facto leader, Saudi Arabia, is considered keen to keep cutting, but sources within the group said it could raise output from July if disruptions continue elsewhere.

Russian Finance Minister Anton Siluanov said over the weekend that Russia and OPEC may decide to boost production to fight for market share with the United States, but this would push oil as low as $40 per barrel.

U.S. energy companies last week increased the number of oil rigs operating for a second week in a row.

On the bullish side, the head of Libya's National Oil Corp warned on Friday that renewed fighting could wipe out crude production in the country.

Production has been also falling steeply in Venezuela due to U.S. sanctions. Iranian output is expected to suffer when the United States tightens sanctions on Tehran in May.

"We see a risk of a spike in oil prices by year-end," said Bank of America Merrill Lynch, citing a weakening dollar and a surge in distillates demand due to rule changes for marine fuels.

(Editing by Dale Hudson)

(c) Copyright Thomson Reuters 2019. Click For Restrictions -

Back to UK Money News

Share Price, Share Chat, Stock Market news at
FREE Member Services
- Setup a personalised Watchlist and Virtual Portfolio.
- Gain access to LIVE real-time Regulatory News (RNS).
- View more Trades, Directors' Deals, and Broker Ratings.
Share Price, Share Chat, Stock Market news at

Datafeed and UK data supplied by NBTrader and Digital Look. While London South East do their best to maintain the high quality of the information displayed on this site,
we cannot be held responsible for any loss due to incorrect information found here. All information is provided free of charge, 'as-is', and you use it at your own risk.
The contents of all 'Chat' messages should not be construed as advice and represent the opinions of the authors, not those of London South East Limited, or its affiliates.
London South East does not authorise or approve this content, and reserves the right to remove items at its discretion.