AGL 38.16 Decreased By ▼ -0.06 (-0.16%)
AIRLINK 134.19 Increased By ▲ 5.22 (4.05%)
BOP 8.85 Increased By ▲ 1.00 (12.74%)
CNERGY 4.69 Increased By ▲ 0.03 (0.64%)
DCL 8.67 Increased By ▲ 0.35 (4.21%)
DFML 39.78 Increased By ▲ 0.84 (2.16%)
DGKC 85.15 Increased By ▲ 3.21 (3.92%)
FCCL 34.90 Increased By ▲ 1.48 (4.43%)
FFBL 75.60 Decreased By ▼ -0.11 (-0.15%)
FFL 12.74 Decreased By ▼ -0.08 (-0.62%)
HUBC 109.45 Decreased By ▼ -0.91 (-0.82%)
HUMNL 14.10 Increased By ▲ 0.09 (0.64%)
KEL 5.40 Increased By ▲ 0.25 (4.85%)
KOSM 7.75 Increased By ▲ 0.08 (1.04%)
MLCF 41.37 Increased By ▲ 1.57 (3.94%)
NBP 69.70 Decreased By ▼ -2.62 (-3.62%)
OGDC 193.62 Increased By ▲ 5.33 (2.83%)
PAEL 26.21 Increased By ▲ 0.58 (2.26%)
PIBTL 7.42 Increased By ▲ 0.05 (0.68%)
PPL 163.85 Increased By ▲ 11.18 (7.32%)
PRL 26.36 Increased By ▲ 0.97 (3.82%)
PTC 19.47 Increased By ▲ 1.77 (10%)
SEARL 84.40 Increased By ▲ 1.98 (2.4%)
TELE 7.99 Increased By ▲ 0.40 (5.27%)
TOMCL 34.05 Increased By ▲ 1.48 (4.54%)
TPLP 8.72 Increased By ▲ 0.30 (3.56%)
TREET 17.18 Increased By ▲ 0.40 (2.38%)
TRG 61.00 Increased By ▲ 4.96 (8.85%)
UNITY 28.96 Increased By ▲ 0.18 (0.63%)
WTL 1.37 Increased By ▲ 0.02 (1.48%)
BR100 10,786 Increased By 127.6 (1.2%)
BR30 32,266 Increased By 934.6 (2.98%)
KSE100 100,083 Increased By 813.5 (0.82%)
KSE30 31,193 Increased By 160.9 (0.52%)
Markets

Oil gains on tighter US supply, Venezuela sanctions

NEW YORK: Oil prices rose about $1 a barrel on Wednesday, boosted by U.S. government data that showed signs of tight
Published January 30, 2019

NEW YORK: Oil prices rose about $1 a barrel on Wednesday, boosted by U.S. government data that showed signs of tightening supply, as investors remained concerned about supply disruptions following U.S. sanctions on Venezuela's oil industry.

U.S. crude futures rose $1.37 to $54.68 a barrel, a 2.6 percent gain, by 1:11 p.m. EST (1811 GMT). Brent crude  futures gained 88 cents, or 1.4 percent, to $62.20 a barrel.

Prices extended gains after government data showed U.S. crude oil stockpiles rose less than expected last week due to a drop in imports, while gasoline inventories fell from record highs as refiners slowed down production.

Crude inventories rose 919,000 barrels, the  Energy Information Administration said, compared with analysts' expectations in a Reuters poll for an increase of 3.2 million barrels.

After eight straight weeks of builds to a record high, gasoline stocks fell 2.2 million barrels last week, versus forecasts for a 1.9 million-barrel gain.

"Because we had a huge drop in gasoline inventories, that gave a bullish tint to the entire report," said Phil Flynn, an analyst at Price Futures Group in Chicago.

The market has been supported since Washington announced export sanctions against Venezuela on Monday, limiting transactions between U.S. companies and the state-owned oil firm PDVSA.

The fight to control Venezuela, which has the world's largest oil reserves, has intensified with the new sanctions aimed at driving President Nicolas Maduro from power, the strongest U.S. measures yet against the socialist president who has overseen economic collapse and an exodus of millions of Venezuelans in recent years.

The sanctions aim to freeze sale proceeds from PDVSA's exports of roughly 500,000 barrels per day of crude to the United States, the OPEC member's largest crude importer.

Traders who sell Venezuelan crude to the United States are looking for avenues to keep crude flowing during the sanctions, according to people familiar with the discussions, while U.S. companies who buy Venezuelan oil have also been looking for work-arounds, seeking counsel for instance on whether the use of third party intermediaries, such as commodity merchants, can continue.

"The main risks for supply could come from a violent confrontation within the country, damaging the oil infrastructure," analyst Carsten Menke at Julius Baer said.

"Yet the risks of such an event seem very low," he added. "This oil will find its way to the market."

Market participants remained worried about global economic growth, which has shown signs of slowing amid a trade dispute between the United States and China, the world's two biggest economies.

Officials from Washington and Beijing are set to launch a new round of trade talks on Wednesday. The two sides have slapped hefty import tariffs on each other's goods.

China reported its lowest annual economic growth in nearly 30 years last week, adding to a litany of worrying economic data from Europe and East Asia.

Copyright Reuters, 2019
 

Comments

Comments are closed.