Crude Oil Approaches $50 As Rally Continues


EIA inventory data, meanwhile, is likely to show a huge build in crude oil stockpiles as US refinery outages from Hurricane Harvey leave oil locked in storage. Hurricane Harvey and Irma too have raised some supply concerns as the two wreak havoc in the south of the U.S., lifting the crude oil prices as inventories depleted and USA rig count slipped.

Global benchmark Brent crude futures, the benchmark for oil prices outside the USA, fell 0.13% to $55.09 a barrel.

Oil prices continued to climb Thursday, rising for a fourth straight day on shrinking global inventories and a bullish forecast for demand. "WTI has been lagging [Brent] of late due to the bearish impact of Hurricane Harvey on refining activity", but played catch up Wednesday.

The EIA said global oil demand will rise to 104 million barrels a day in 2030 from 95 million barrels a day in 2015 in its annual International Energy Outlook released yesterday. That's below the forecast for a rise of 10.1 million barrels by analysts surveyed by S&P Global Platts.

This week's gains have come despite data showing a big build in US crude inventories after Hurricane Harvey. Harvey made landfall on the Texas coast on August 25.

"Disruptions had sent product prices higher and crude prices lower temporarily".

Last week, crude inventories in the USA increased by 5.9 million barrels, while gasoline stocks declined by 8.4 million barrels.

"We're all trying to make our way in this world of between $50 and $60 and I would expect that to continue". Meanwhile, demand is expected to increase by 1.6 million barrels a day, up from a July estimate of 1.5 million barrels.

"Though hard to predict, if stockpiles continue to deplete and demand remains fairly steady in OECD economies, whilst emerging Asia (including China) increases energy consumption, crude prices could trade around the US$54-57/barrel range in Q4 2017, rising to US$60 in Q1 2018", commented Moin Siddiqi, economist.

On Nymex, October gasoline fell about a penny to $1.647 a gallon, while October heating oil added 2.8 cents, or 1.6%, to $1.769 a gallon.

Zanganeh said compliance by members of the Organization of the Petroleum Exporting Countries with an agreement to curb oil output had been about 98 percent in the past eight months and would improve in the future.

But with oil demand perking up as well as hurricanes and regular summer maintenance knocking out some production, the IEA said it has seen some of that glut disappear.

It was followed by the IEA saying the global oil glut was shrinking, thanks to strong European and US demands as well as production declines in OPEC and non-OPEC countries.