Patra SK - News
Aug 27, 2015
Oil Near Six-Year Low on Japan Data, Oversupply


London - Oil prices fell towards six-year lows on Monday after data showed Japan's economy contracted and producers in the United States added drilling rigs for a fourth straight week despite a recent rout in prices.


Japan's economy, the world's third biggest oil consumer, shrank in the second quarter from a year earlier, adding to fears that slowdowns in Asia's biggest economies will weigh on oil demand.


The global oversupply picture was exacerbated by another weekly jump in US oil rig additions, hinting at growing production, and news that Oman produced a record-breaking 1 million barrels a day in July.


US crude, or West Texas Intermediate (WTI), for September was trading 70 cents lower at $41.80 a barrel at 0830 GMT, close to its lowest level in more than six years.


Brent for October was down 60 cents at $48.59 a barrel, still a few dollars shy of its six-year low of $45.19. The September contract expired on Friday.


"The oversupply story remains well intact, which fuels the bearish sentiment," said Carsten Fritsch, senior oil analyst at Commerzbank in Frankfurt.


Production by the Organization of the Petroleum Exporting Countries is running well above demand filling stockpiles worldwide. Iran is expected to increase its oil exports once Western sanctions are lifted after ratification of a recent nuclear deal.


Many analysts expect prices to remain depressed as bearish factors hinting at sustained oversupply are set to persist.


"The end of the summer driving season and the start of refinery maintenance season will weigh on near-term demand and pressure prices," said Societe Generale oil analyst Michael Wittner.


"Oversupply, high stocks, and seasonal weaknesses are outweighing record demand growth," he added.


Demand for crude oil is set to fall in the next few weeks as refineries start annual maintenance. A number of European refineries will close for maintenance in September and October, including Royal Dutch Shell, Statoil and Total .


Citigroup has cut its crude oil price outlook citing weak market fundamentals, including an increased supply from OPEC and challenging demand growth in China and emerging markets.


The Wall Street bank lowered its base case Brent price forecasts to $54 per barrel for 2015 and $53 in 2016 from $58 and $63 respectively.


Additional reporting by Lisa Barrington, Jacob Gronholt-Pedersen & Henning Gloystein



Source : The Jakarta Globe

Related News:
Oct 27, 2015

Govt to Hold Bilateral Meetings With OPEC States in Vienna

Jakarta - The government is scheduled to hold bilateral talks with oil-producing nations on the sidelines of the annual Organization of the Petroleum Exporting Countries (OPEC) conference in Vienna, Austria, this week.

Oct 27, 2015

Global Oil Prices Drop as US Supplies Increase

Jakarta - Global oil prices decrease on Thursday, October 22, 2015, following the increase in the United States crude supply, which raises concern on excessive global crude supplies.

Oct 13, 2015

Pertamina to Build Steam Power Plant in Palu

Palu - State-owned oil and gas company, Pertamina will build a gas power plant in Palu city, Central Sulawesi province.

Website Policy and Disclaimer. The information contained in this website is for general information purposes only. The information is provided by PT. Patra SK and while we endeavour to keep the information up to date and correct, we make no representations or warranties of any kind, express or implied, about the completeness, accuracy, reliability, suitability or availability with respect to the website or the information, products, services, or related graphics contained on the website for any purpose. Any reliance you place on such information is therefore strictly at your own risk. In no event will we be liable for any loss or damage including without limitation, indirect or consequential loss or damage, or any loss or damage whatsoever arising from loss of data or profits arising out of, or in connection with, the use of this website. Through this website you are able to link to other websites which are not under the control of PT. Patra SK. We have no control over the nature, content and availability of those sites. The inclusion of any links does not necessarily imply a recommendation or endorse the views expressed within them. Every effort is made to keep the website up and running smoothly. However, PT. Patra SK takes no responsibility for, and will not be liable for, the website being temporarily unavailable due to technical issues beyond our control.