Oil falls 1% as focus shifts to high USA fuel stocks

Andrew Cummings
January 14, 2020

Crude oil prices fell roughly 1% Monday as Middle East tensions lessened and investors focused more on lackluster seasonal demand following last week's US report showing large fuel inventories.

West Texas Intermediate (WTI), the U.S. crude benchmark, was down 74 cents, or 1.3%, at $58.28 per barrel.

Crude oil futures slipped 0.75 percent to Rs 4,101 per barrel on January 14, as participants trimmed their positions ahead of the signing of the so-called Phase One of the US-China trade deal, which will be vital to gauging the direction of the market.

Brent crude was down 60 cents at $64.38 per barrel at 11:57 a.m. CST (1757 GMT), while West Texas Intermediate (WTI) crude was down 65 cents at $58.39 a barrel.

Oil prices steadied on Monday as investors shifted their focus away from easing Mideast tensions to this week's scheduled signing of an initial U.S.

"This year, however, the pace is expected to pick up again and is to average at 1.25 million bpd".

Meanwhile, expectations of thawing trade tensions between the United States and China, the world's two biggest oil consumers, have offered support for prices.

Still, with traders already pricing in the signing of the deal, there is more downside risk to prices, said Michael McCarthy, chief market strategist at CMC Markets.

Brent hit four-month highs of $71.75 last week, while WTI surged to an eight-month peak of $64.72, reacting to the Tehran action which was in retaliation to the U.S. killing of top Iranian general Qasem Soleimani on January 3.

"As geopolitical tensions take a back seat for now, we may see more of the same in the short term", Tchilinguirian said.

Oil prices rose slightly on Tuesday amid optimism about a U.S.

He also said it was too early to talk about whether the Organization of the Petroleum Exporting Countries and its allies, a group known as OPEC+, would continue with production curbs set to expire in March.

USA crude inventories were expected to have fallen last week, while gasoline stocks were set to gain for the tenth straight week, a preliminary Reuters poll showed Monday. The threat of an outright war has receded since Tehran fired missiles at U.S.

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