Brent’s six-month contango curve highlights oversupply concerns, as crumbling demand keeps a lid on gains
London — Oil prices ticked up on Thursday after sharp losses in the previous session, with investors hoping that a big build-up in US inventories may mean producers have little option but to deepen output cuts as the coronavirus pandemic ravages demand.
Swiss bank Julius Bär’s head of economics Norbert Rücker said, “Oil prices must remain depressed to force shut-ins among non-Opec producers,” such as the US, where much production is not economic at current prices. “We stick to our neutral view and see prices continuing to swing wildly around current levels in the very near term.”
“The massive storage build, as counter-intuitive as it sounds, did provide some price support as the build foreshadows that more well-head closures are just around the corner, which effectively trims US supply,” said Stephen Innes, chief global markets strategist at AxiCorp. Hoped-for cuts of another 10-million bpd from other countries, including the US, could lower production by 20-million bpd, though some analysts have questioned that number.
South Africa Latest News, South Africa Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
Oil drops slightly as Opec+ cuts seen as unlikely to workThere is some pick up in oil demand from China, however, and the US is likely to sharply drop its shale oil output
Read more »
Oil falls as demand drops to levels not seen in 25 yearsThe International Energy Agency says no amount of output cuts can offset the falls in the market
Read more »
Oil prices bounce back after big losses on TuesdayHowever, there is concern that a record global output cut by producers will not offset falling fuel demand due to efforts to contain Covid-19
Read more »
Doctors desperate to know what kills us: the virus or our bodies?They suspect the immune system’s response may be so strong that it ‘ultimately overwhelms the patient’s organs’
Read more »
Desperate doctors want to know if the coronavirus or our own body kills usOnline science publication Nature says that scientists are not sure “whether the virus itself” is what kills us, or whether our immune system’s response is so strong that it “ultimately overwhelms the patient’s organs”.
Read more »
Donald Trump stops US funding of WHO, saying it failed in its dutyThe move to limit support to the World Health Organisation in the midst of a global pandemic is unprecedented
Read more »