Published: Mon, April 08, 2019
Markets | By Otis Pena

Oil prices rise 1.5 percent as strong U.S

Oil prices rise 1.5 percent as strong U.S

Year to date Brent is up 30.7% in the year to date, while WTI has surged almost 39%.

The West Texas Intermediate for May delivery increased 0.98 US dollar to settle at 63.08 dollars a barrel on the New York Mercantile Exchange, while Brent crude for June delivery increased 0.94 dollar to close at 70.34 dollars a barrel on the London ICE Futures Exchange. The contract fell 36 cents in the previous session, having hit $62.99 on Wednesday, its highest since November.

U.S. West Texas Intermediate (WTI) crude settled at $63.08 a barrel, up 98 cents, or 1.58 percent.

Despite the host of price drivers, there remain factors that could bring oil down later this year. "Signs of global economic slowdown had been a headwind for oil prices, but this morning's report seemed to dispel at least some of those concerns".

Also helping oil shake early weakness was the solid March jobs report for the United States showing 196,000 new jobs were created last month and a slowing in the annual rate of wage growth to 3.2% from 3.4%.

Escalating tensions in Libya and Venezuela have also supported prices, with worries about economic growth and booming USA shale output providing the only checks on the rally.

The two sides have gone through several rounds of talks, however as Reuters reported, on Thursday commander Haftar ordered his troops to march on Tripoli, escalating the conflict between the two sides. Escalating tensions in Libya and and Venezuela are also providing support for crude. Morse believes that the focus for the USA will be sanctions and Venezuela and this would likely see "kinder" actions on those importing Iranian oil.

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Venezuelan state-owned oil company PDVSA expects its crude upgraders to operate well below capacity this month, according to industry sources and documents seen by Reuters.

"The OPEC+ group has so far maintained a high compliance with their output-cut deal, which together with positive economic data from the US and China, are supporting oil prices", Kumar said.

On April 5 at 6:25 AM EST, US crude oil prices were nearly unchanged from the previous close. -China trade relations limited oil price gains.

According to the U.S. Energy Information Administration (EIA), for the week ending March 29, U.S. commercial crude oil inventories increased by 7.2 million barrels from the previous week.

Also aiding oil sentiment on Thursday was a scheduled meeting between President Donald Trump and China's Vice Premier Liu He at 4:30 P.M. ET, where they were to discuss and possibly announce what could be the outline of a trade deal to end a bitter year of tariff wars between the two giant economies.

Lingering concerns over U.S.

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. This article is strictly for informational purposes only. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.

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