BPCL, HPCL and International Olympic Committee surge up to 6% as crude prices tumble

Cornelia Mascio
Luglio 12, 2018

This raised the possibility that China would retaliate by slapping a tariff on imports of US crude oil.

Brent crude added 55 cents, or 0.7 per cent, to $78.62 per barrel by 0638 GMT, following a 1.2-percent climb on Monday.

"The scope of today's sell-off is unequivocally a speculative washout", said Saucer.

Crude oil prices also fell as the USA dollar rose on Wednesday's surprisingly strong US inflation report, which increased prospects the Federal Reserve will raise interest rates twice more this year.

The declines followed a months-long rally that had increased prices to some of the highest levels in recent years. A stronger dollar can weaken dollar-denominated commodities, like crude. "This will become an even bigger issue as rising production from Middle East Gulf countries and Russian Federation, welcome though it is, comes at the expense of the world's spare capacity cushion, which might be stretched to the limit", the Paris-based organization said Thursday.

Oil prices suffered steep falls on Wednesday after Libya said it would boost supply, even as investors fear that trade tensions will hit demand.

With the sanctions on Iran's oil exports and its central bank about to take effect on November 4, US Secretary of State Mike Pompeo said on Tuesday that his country may grant oil sanctions waivers to countries seeking relief from the measures. "In turn, this could have a marked impact on oil demand growth".

The decline in USA inventories was partially due to a fall in stocks at the Cushing, Oklahoma delivery hub for US crude futures, which dropped 2.1 million barrels. This action would substantially weaken demand for U.S. WTI crude oil. The recovery was prompted by a report from the US Energy Information Administration that US crude oil inventories fell by 12.6 million barrels in the week to July 6, nearly three times the drop expected.

Saudi Arabia might have to draw harder than ever before on its spare production capacity as a spiraling economic crisis in Venezuela, renewed US sanctions on Iran and disruptions in Libya strain global markets, the agency predicted. "Our markets remain open while we work directly with customers to resolve the issue", a CME spokesman said in an emailed statement.

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