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Copper Tip Energy Services
Copper Tip Energy
Hazloc Heaters

Oil Drops as Investors Weigh Saudi Recovery Against Trade Hope

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These translations are done via Google Translate

By Alex Longley

(Bloomberg) Oil fell as investors weighed Saudi Arabia’s quicker-than-expected recovery from the biggest attacks ever on its energy industry against prospects of a thaw in the U.S.-China trade war.Futures dipped 0.7% in New York after sliding 3.7% over the previous two sessions. Saudi Arabia has boosted production capacity to more than 11 million barrels a day, beating its own target by about a week, and raised output to above 8 million, according to people with knowledge of the matter. U.S. President Donald Trump said Wednesday that a deal with Beijing could happen “sooner than you think,” offering a glimmer of hope for global oil demand.

Oil futures drop as Saudi Arabia recovers from attacks

The attacks on two oil installations in Saudi Arabia knocked out almost 5% of global supply and are driving crude to its biggest monthly advance since June. However, prices are almost back to where they were before the Sept. 14 strikes as the kingdom is restoring production and demand continues to be a concern. The prolonged U.S.-China trade war has already almost halved oil consumption growth, Citigroup Inc. said earlier this month.

“Less than two weeks after the attacks on Saudi Arabia, the oil market has returned to business as usual,” said Norbert Ruecker, head of economics at Julius Baer. “Saudi has seemingly restored supplies faster than anticipated, and the oil market is shifting its focus back to the soft economy and stagnant oil demand.”

West Texas Intermediate for November delivery lost 38 cents to $56.11 a barrel on the New York Mercantile Exchange as of 8:46 a.m. local time. Brent for the same month fell 27 cents to $62.12 on the ICE Futures Europe Exchange, after closing 71 cents lower on Wednesday. It traded at a $5.96 premium to WTI.


See also: Oil Traders Rattled by U.S. Sanctions on China Tanker Firms

Trump said there is a “good chance” a trade deal can be reached, adding that Beijing is starting to make big purchases of items such as beef and pork. The tone toward China was vastly different earlier this week, with Trump accusing the Asian nation of currency manipulation, theft of intellectual property and product dumping during his speech at the UN General Assembly.

Other oil-market news
  • Saudi Aramco has boosted crude production to more than 8 million barrels a day and is recovering to the level prior to the Sept. 14 attacks, according to people briefed on the situation.
  • Fuel retailers in India are scrambling for liquefied petroleum gas ahead of the nation’s most celebrated festival, as demand looks set to climb just as attacks on Saudi Arabian facilities hurt exports.
  • Saudi Arabia’s crude exports haven’t fully recovered from the attacks, with observed loadings at about 5.86 million barrels a day from Sept. 14 through Sept. 25, preliminary tanker-tracking data compiled by Bloomberg show.

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