Oil prices extend gains after big U.S. inventory draw

Oil prices rose yesterday, with benchmark Brent crude trading at 50.92 dollars a barrel after a fall in USA inventories and a bigger-than-expected cut in Saudi supplies to Asia helped tightened the market.

On the New York Mercantile Exchange crude futures for June delivery rose 0.10% to $47.88 a barrel, while on London's Intercontinental Exchange, Brent was last quoted up 0.08% to $50.81 a barrel. Brent settled at $US50.77, up 55 cents or 1.1 per cent. It was the highest closing price in a week for both benchmarks.

Sign up here for free access to 7 articles per month + twice daily business email alerts.

Amid reports of an Organization of the Petroleum Exporting Countries (OPEC) production cutback consensus reaching fever pitch and the market responding accordingly, Vitol delivered a one-two punch to optimists by reminding them that the oil market is not seeing a de-stocking that was expected and that US shale continues to grow faster than anyone expected. Inventories of refined products also fell.

OPEC members agreed in November to cut production by 1.2 million barrels per day for six months beginning from the start of the year in a bid to reduce the glut of oil supplies on the shore up prices.

"The market is in flux because we've all traditionally said there is this huge price regulator sitting there, that has been OPEC, and I think that model is severely challenged today", he said.

M - Turkmenistan is likely to join an OPEC-led cut in oil supply aimed at supporting prices, sources in OPEC and the industry said, potentially enlarging the output reduction slightly, Reuters reported.

On 25 May, Opec will meet to determine policy for the second half of 2017.

OPEC's revision is largely based on higher production in the United States, where producers who rely on expensive advanced drilling methods have become more profitable as prices rise.

Total non-OPEC growth rose to 580,000 barrels in April; U.S. production accounted for the bulk of non-OPEC growth around 540,000 barrels, or 93%.

U.S. crude oil production has already risen by over 10 percent since its mid-2016 trough, to more than 9.3 million bpd, close to levels of top producers Russian Federation and Saudi Arabia.

Opec also said it sees more supply coming from non-member countries such as the US.

Optimism was also fuelled by the Organization of the Petroleum Exporting Countries' report that showed cartel members were sticking to the production quotas. Egypt's oil consumption outpaces its production, which is estimated at 700,000 bpd.

"You're going to have to have a few weeks of 5 million-barrel draws just to get back to square one", he said.

  • Canada helping battle famine in South Sudan, ready to do more: Trudeau

    More than 3 million people have fled their homes, creating Africa's biggest refugee crisis since the Rwandan genocide in 1994. The assault in the town of Leer, which lies in an oil-producing region, was repelled by Ghanaian peacekeepers.

    Patrick Beverley to play in Game 4 after grandfather dies

    Both lessened the burden Leonard usually carries on offense, allowing him to focus more energy on the defensive end. Green going to the bench also results in a considerable swing, with the team's net rating dropping from 5.5 to -1.7.
    Czech PM to submit government resignation in 2nd half of May

    Czech PM to submit government resignation in 2nd half of May

    Markets have a tradition of casting aside Czech political shenanigans, assured by the strength of the country's institutions. It's no secret that Czech President Milos Zeman is not a fan of Prime Minister Bohuslav Sobotka.
  • Ambition to meet reality as China gathers world for Silk Road summit

    Ambition to meet reality as China gathers world for Silk Road summit

    A new propaganda video in China attempts to explain the myriad benefits of the country's "One Belt, One Road" initiative . For example, in Sri Lanka a change of government led to the renegotiation of a major port project.
    Syrian refugees name baby for Canadian PM Justin Trudeau

    Syrian refugees name baby for Canadian PM Justin Trudeau

    So when Afraa Bilan gave birth to her son, the 22-year-old and her husband Muhammad, 29, knew what they were going to name him. She noted that little Justin Trudeau is the family's first Canadian and beat the rest of them to getting citizenship.
    Toronto Raptors end Milwaukee Bucks season

    Toronto Raptors end Milwaukee Bucks season

    But The Greek Freak made a very poor decision when the Bucks were trying to complete their comeback in the final seconds. There were marvelous athletic feats from Antetokoumpo and timely jumpers from Khris Middleton and Matthew Dellavadova.
  • Mets suspend Matt Harvey 3 days for violating team rules

    Mets suspend Matt Harvey 3 days for violating team rules

    The Mets suspended pitcher Matt Harvey for three days without pay for breaking team rules, but have not disclosed which rules. NY also claimed lefty Tommy Milone off waivers from Milwaukee - he was 1-0 with one save and a 6.43 ERA.
    Family Kicked Off Delta Flight After Refusing To Give Up Seat

    Family Kicked Off Delta Flight After Refusing To Give Up Seat

    Our team has reached out, and we will be talking with them to better understand what happened and come to a resolution". A YouTube video of the incident had clocked up more than two million views by this morning.

    Prabhas to skip Karan Johar's Baahubali 2 bash

    However, Prabhas welcomed none of the proposals and only glued to work for last 5 years - that proves his commitment for films. The sequel has surpassed SS Rajamouli's original film Bahubali: The Beginning's record, which grossed Rs 519 crore in 2015.
  • Judges Question Religious 'Neutrality' of Trump's Revised Travel Ban

    But Judge Robert King, a Democratic appointee, noted that Trump has never retracted previous statements calling for a Muslim ban. It restricted entry to the USA for people from six countries - Iran, Libya, Somalia, Sudan, Syria and Yemen - for 90 days.
    Afghanistan- 36 Daesh fighters killed in Nangarhar

    Afghanistan- 36 Daesh fighters killed in Nangarhar

    The U.S. military statement said 35 Islamic State fighters and several high ranking commanders were killed in the April 27 raid. Forces - Afghanistan, said in a statement . "Any ISIS member that comes to Afghanistan will meet the same fate", he vowed.

    Wenger: I hate myself after bad Arsenal results

    The same can not be said of Mesut Ozil though, with the World Cup victor under-fire, under scrutiny and, he believes, underpaid. Speaking before Sunday's home match with Manchester United, the Frenchman joked: "That means I was wrong".