Published: Mon, November 18, 2019
Markets | By Otis Pena

Oil Prices Drop Due to US- China Trade Deals

Oil Prices Drop Due to US- China Trade Deals

USA government data showed stockpiles expanded by 2.22 million barrels last week as production rose to a record, while the International Energy Agency said fresh supplies from America and beyond will continue to "calm" world markets in 2020.

Crude production rose by 200,000 barrels per day (bpd) to a weekly record of 12.8 million bpd, the data showed.

Crude oil prices gained traction during the first half of the day and the barrel of West Texas Intermediate (WTI) reached a fresh weekly high of $57.75 before reversing its direction during the American trading hours.

Gasoline inventories rose by almost 1.9 million barrels, versus expectations for a drop of 1.17 million barrels. Finished gasoline and blending components inventories both increased last week.

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Propane/propylene inventories decreased by 2.5 million barrels last week and were about 10 percent above the five-year average for this time of year. That outweighed United States government data earlier this week that showed an expansion in crude stockpiles and oil production at record-high levels.

Distillate stockpiles, which include diesel and heating oil, fell by 2.5 million barrels in the week, versus analysts' expectations in a Reuters poll for a 950,000-barrel drop, the EIA data showed.

China's imports of the Omani crude oil registered a remarkable rise by 14 per cent of the total imports during October 2019, comprising 91.96 per cent of the total exports of the Omani crude oil compared with the previous month (September 2019). Still, this reading easily beat the forecast of 1.5 million.

"There is still one fact that continues to cast a bearish shadow over the oil market: non-OPEC supply growth will outstrip the expansion in global oil demand next year", said Stephen Brennock, an analyst at PVM Oil Associates Ltd.in London. -China trade deal and hopes the OPEC might decide to deepen their supply cuts in the coming year helped ease concerns about outlook for energy demand. The average price of West Texas crude grade in NY stood at US$54.03 per barrel, comprising a decline by US$2.86 compared with the trading of September 2019.

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