OIL PRICE: ABOVE $58
Brent crude futures, the international benchmark for oil prices, were at $58.16 at 0643 GMT, up 28 cents, or 0.5 percent from their last close - and almost a third above mid-year levels.
U.S. West Texas Intermediate (WTI) crude futures were at $52.03 per barrel, up 15 cents, or 0.3 percent, and almost a quarter above mid-June levels.
Trading volumes were limited during Asian hours on Wednesday due to a public holiday in Singapore, Malaysia and parts of India.
However, a technical pattern known as a 'Golden Cross' was approaching in WTI crude oil contracts on Wednesday, in which the 50-day moving average price climbs higher than the 200-day moving average. This is widely seen as a bullish price indicator, and already occurred with Brent futures on Sept. 25.
Traders said that prices were pushed up by a drop in U.S. crude inventories as well as concerns that fighting in Iraq and mounting tensions between the United States and Iran could affect supplies.
U.S. crude inventories fell by 7.1 million barrels in the week to Oct. 13 to 461.4 million barrels, the American Petroleum Institute (API) said late on Tuesday.
"API data from the U.S. overnight showed a big draw ... If $52.83 in WTI and $59.22 in Brent give way, then oil is stepping into a new and much higher range," said Greg McKenna, chief market strategist at futures brokerage AxiTrader.
Official U.S. fuel inventory data is due later on Wednesday from the Energy Information Administration, which Dutch bank ING said would likely also show a stock drawdown.
Adding to a tightening U.S. market, tensions in the Middle East meant that a risk premium was being priced into oil markets.
Iraqi government forces captured the major Kurdish-held oil city of Kirkuk earlier this week, responding to a Kurdish independence referendum, and there are concerns that fighting could disrupt supplies.
"In the case of Kurdistan, the 500,000 barrel-per-day (bpd) Kirkuk oil field cluster is at risk," U.S. bank Goldman Sachs said on Tuesday.
The Iraq crisis adds to a looming dispute between the United States and Iran. U.S. President Donald Trump last week refused to certify Iran's compliance over a nuclear deal, leaving Congress 60 days to decide further action against Tehran.
During the previous round of sanctions against Iran, some 1 million bpd of oil was cut from global markets.
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IMF - Output grew by 3.8 percent in 2017, underpinned by a resilient non-hydrocarbon sector, with robust implementation of GCC-funded projects as well as strong activity in the financial, hospitality, and education sectors. The banking system remains stable with large capital buffers. Growth is projected to decelerate over the medium term.
IMF - Higher oil prices and short-term portfolio inflows have provided relief from external and fiscal pressures but the recovery remains challenging. Inflation declined to its lowest level in more than two years. Real GDP expanded by 2 percent in the first quarter of 2018 compared to the first quarter of last year. However, activity in the non-oil non-agricultural sector remains weak as lower purchasing power weighs on consumer demand and as credit risk continues to limit bank lending.