OCTOBER 6, 2017 – Oil is set for the first weekly decline since early September on rising global output as Tropical Storm Nate moves toward the U.S. Gulf.
Futures were little changed in New York and are down 1.8 percent this week. OPEC output climbed marginally in September, U.S. production reached a two-year high last week and Libya restarted its biggest oil field. Companies from BP Plc to Chevron Corp. are shutting platforms in the Gulf of Mexico to prepare for Tropical Storm Nate, which is forecast to become a hurricane south of Louisiana on Saturday.
While oil rallied into a bull market last month on the prospect of stronger demand, prices struggled to hold above $52 a barrel as supply grew from the U.S. and two members of the Organization of Petroleum Exporting Countries that are exempt from making cuts. Saudi Arabia and Russia reaffirmed their cooperation during a visit from King Salman bin Abdulaziz this week, with President Vladimir Putin saying he is open to extending the agreement with OPEC until the end of 2018 if required.
“Higher OPEC production in September as well as the prompt return of supplies from Libya after the brief closure of their biggest field weighed on oil futures this week,” said Giovanni Staunovo, an analyst at UBS Group AG in Zurich.
West Texas Intermediate for November delivery was at $50.73 a barrel on the New York Mercantile Exchange, down 5 cents, at 9:15 a.m. London time. Total volume traded was about 54 percent below the 100-day average. Prices rose 81 cents to $50.79 on Thursday, the first gain in four sessions.
Brent for December settlement rose 17 cents to $57.18 a barrel on the London-based ICE Futures Europe exchange. Prices are down 0.6 percent for the week. The global benchmark crude traded at a premium of $6.08 to December WTI.