Published: Fri, March 22, 2019
Markets | By Otis Pena

Full Speed Ahead for Crude Prices Due to OPEC Defying White House

Full Speed Ahead for Crude Prices Due to OPEC Defying White House

The threat of rising oil prices-and a subsequent jump in US gasoline prices days before the Midterm elections-spurred the United States to temper its November oil export sanctions on Iran, by granting waivers to eight countries and allowing them to continue buying the nation's crude.

Yesterday, Brent crude touched a four-month high of US$67.61 per barrel, amid expectations that the Organization of the Petroleum Exporting Countries (OPEC) would continue production cuts through to the end of the year.

As of 7:39 a.m. EST on Friday, West Texas Intermediate prices fell 0.8 percent to $59.45 per barrel. For the week ended March 15, US crude oil refinery inputs averaged 16.2 million barrels per day, which was 178,000 barrels per day higher than the previous week, the EIA said in a report on Wednesday.

According to data from US Energy Information Administration, crude oil inventories dropped 9.6 million barrels last week, while analysts' forecast was an increase of 3,09,000 barrels.

To keep the pressure on USA shale oil producers, Saudi Arabia hit the United States with a huge oil export cut this year.

"Venezuelan exports to the USA have finally dried up, after the sanctions were placed on them by the United States administration earlier this year", ANZ bank said.

Prices for both benchmark had climbed by more than 1% Wednesday after US government data showed an unexpectedly large fall in domestic crude inventories.

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Crude prices have been pushed up by nearly a third since the start of 2019 by supply cuts led by OPEC, as well as sanctions enacted against Iran and Venezuela by the United States.

"Global economic growth still remains a concern", said the director of energy consultancy Trifecta.

During Thursday's trading sessions on the commodity exchanges of London and NY, the crude oil prices receded, Kazinform correspondent reports. Additionally, inventories fell to their lowest level since January.

Asian business confidence held near three-year lows in the first quarter as the U.S.

Iran's export levels have become more opaque since US sanctions on the country's oil sector took effect in November, although estimates of March supplies are falling into a narrower range than in previous months.

"The positive sentiment from OPEC's cuts is outweighing the bearish impact of the US shale boom", said Matt Smith, director of commodity research at ClipperData, a research firm tracking the global oil industry.

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