Oil prices fall as concerns over global fuel glut re-emerge - Sean Seshadri Trading Tampa

Oil prices fell on Wednesday, pulled down by a report of surging U.S. crude inventories, rising output in Nigeria and squabbling among producers about a planned output cut, which together re-ignited concerns over a global supply glut.

U.S. West Texas Intermediate crude oil futures (CLc1) were trading at $49.34 per barrel at 0012 GMT, down 62 cents, or 1.24 percent, from their last settlement.

International Brent crude futures (LCOc1) were down 53 cents, or 1.04 percent, at $50.26 a barrel.

"Crude is on the defensive this morning following American Petroleum Institute (API) inventory numbers showing a rise of 4.8 million barrels against an expected rise of 1.7 million," said Jeffrey Halley, senior market analyst at brokerage OANDA in Singapore.

Official fuel storage data by the Energy Information Administration (EIA) is due later on Wednesday.

"EIA crude inventory figures will be closely watched tonight. A large jump in inventories will no doubt see crude pushed lower again," Halley said.

Further stoking supply, Royal Dutch Shell (L:RDSa) has resumed crude exports from the Forcados terminal in Nigeria's restive Niger Delta following repairs after a militant attack, the Nigerian presidency said late on Tuesday.

Traders said that squabbles within the Organization of the Petroleum Exporting Countries (OPEC) about a planned output cut later this year were also weighing on markets.

Iraq, OPEC's second biggest oil producer, wants to be exempt from the cut, arguing it needs the revenues to fight Islamic State.

Other OPEC-members, including Libya and Nigeria, are likely to be exempt from cutting production, while Iran and Venezuela and Indonesia are also unlikely to reduce output.

Unless non-OPEC production giant Russia joins the effort, that leaves the onus of a potential cut with Arab producers in the Middle East like Saudi Arabia, Kuwait and the United Arab Emirates (UAE).

"OPEC appears to be approaching the limits of its ability to jawbone oil higher without something concrete to put on the table," OANDA's Halley said. 

Oil prices drop as Iraq says doesn't want to join OPEC cut - Sean Seshadri

Oil prices fell early on Monday as Iraq said it wanted to be exempt from any deal by producer cartel OPEC to cut production to prop up the market, and as U.S. drillers stepped up work.

Brent crude futures (LCOc1) were trading at $51.59 per barrel at 0133 GMT, down 19 cents, or 0.4 percent, from their last close.

U.S. West Texas Intermediate (WTI) crude was down 22 cents, or 0.4 percent, at $50.63 a barrel.

Traders said the price falls followed comments from Iraq, which said it wanted to be exempt from a production cut by the Organization of the Petroleum Exporting Countries (OPEC) that the group plans to decide at its Nov. 30 meeting.

OPEC plans to reduce production to a range of 32.50 million to 33.0 million barrels per day (bpd), down from 33.39 million bpd in September.

That would be harder to achieve if Iraq, which is OPEC's second-biggest producer after Saudi Arabia, didn't participate.

Iraq said on Sunday that its oil production stood at 4.774 million bpd, with exports standing at 3.87 million bpd.

"We are not going back in any way, not by OPEC not by anybody else," said Falah al-Amri, the head of Iraq's State Oil Marketing Company.

"Comments by Iraq over the weekend that it may not join the OPEC agreement to cut production could see oil prices come under pressure in today's session," ANZ bank said on Monday.

Also pressuring the market, U.S. oil rigs rose by 11 last week, the first double-digit increase since August. [RIG/U]

"We should see rig counts continue to increase in the wake of the recent price rally,"Morgan Stanley (NYSE:MS) said.

Ongoing strength in the dollar (DXY), which can crimp demand as it makes fuel purchases more expensive for countries using other currencies at home, also weighed on oil.

On the demand side, Japan's crude imports fell 4.6 percent in September from the same month a year earlier, to 3.27 million bpd, official data showed on Monday.

Despite Monday's lower prices, analysts said that oil markets, which have been dogged by two years of oversupply, might be rebalancing in terms of production and consumption.

"Statistical balances suggest that conditions have improved markedly. We suspect that the market is moving more quickly into balance than is generally recognised," Barclays(LON:BARC) bank said in a note to clients on Sunday.

"The market moved into a small deficit in Q3, will remain so in Q4 and then the deficit will expand significantly in 2017," it added.

Strong dollar pulls down oil despite tightening fundamentals - Sean Seshadri

Oil prices fell on Friday, pulled down by a stronger dollar, but traders said there were signs that physical fuel markets were tightening after two years of ballooning oversupply.

The dollar rose to its highest level since March against a basket of other leading currencies (DXY) on Friday, potentially crimping demand as fuel becomes more expensive for countries using other currencies.

U.S. West Texas Intermediate (WTI) crude (CLc1) was trading at $50.40 a barrel at 0208 GMT, down 23 cents, or 0.5 percent, from its last settlement.

International Brent crude oil futures (LCOc1) were down 19 cents, or 0.4 percent, at $51.19 per barrel.

Crude prices fell over 2 percent in the previous session on the back of the soaring dollar.

Despite the falls, overall sentiment in physical oil markets was confident as there are mounting signs of a tightening oil market.

"The near term fundamentals in the oil market have turned positive. Demand is stabilizing, OPEC production has peaked (and will fall if cuts are implemented), and global inventory declines imply that the market is more balanced than many believe," Neil Beveridge of Bernstein Energy said in a note to clients.

The Organization of the Petroleum Exporting Countries (OPEC) plans to implement a 0.5 to 1 million barrels per day production cut after a meeting on Nov. 30.

OPEC's current output stands at a record 33.6 million barrels per day.

Bernstein's Beveridge said that due to OPEC's cuts and general market conditions, he was "forecasting a return to $60 per barrel in 2017 and $70 per barrel in 2018", adding that even higher prices would be prevented by rising production outside OPEC.

"Ultimately, a rise in U.S. production (and non-OPEC supply more broadly) will cap the recovery in price," he said.

U.S. crude oil production has fallen almost 12 percent since peaks in 2015, to around 8.5 million barrels per day. But rising drilling activity has slightly lifted output again in recent weeks, in what some analysts say is an early indicators that the U.S. shale industry has adapted to lower prices and can operate at around $50 per barrel.

VEGOILS-Market factors to watch Oct 20 - Sean Seshadri Trading Tampa

The following factors are likely to influence Malaysian palm oil futures and other vegetable oil markets.

FUNDAMENTALS

* Malaysian palm oil strengthened on Wednesday evening, tracking stronger performing rival soyoil, after a market correction on weaker exports pulled it down in early trade. POI/

* U.S. soybean futures rose on Wednesday on technical buying, export demand and spillover strength from crude oil, analysts said. GRA/

* Oil prices jumped more than 2 percent on Wednesday, with U.S. crude settling at its highest in 15 months after the government reported a surprisingly large drop in inventories for the sixth week out of seven. O/R

MARKET NEWS

* Crude oil prices rose to a 15-month high on Wednesday after a surprise U.S. inventory drawdown, boosting energy shares. MKTS/GLOB

RELATED > India's drought-stricken farmers plant thirstiest crop > SGS says not had talks with Egypt over wheat inspections > Stronger-than-expected La Niña may be brewing -Braun > Canada energy regulator could be curbed after pipeline fiasco > Venezuela congressional probe says $11 bln missing at PDVSA > Cargo surveyor ITS releases Malaysia's Oct 1-20 palm oil export data on Oct 20 > Cargo surveyor SGS releases Malaysia's Oct 1-20 palm oil export data on Oct 20.

* For a table on Malaysian physical palm oil prices, including refined oil, Reuters Terminal users can double click on or type MYPALM/FLAT .

* To view freight rates from Peninsula Malaysia/Sumatra to China, India, Pakistan and Rotterdam, please key in OILS/ASIA2 and press enter, or double click between the brackets.

* Reuters Terminal users can see cash and futures edible oil prices by double clicking on the codes in the brackets: To go to the next page in the same chain, hit F12. To go back, hit F11.

Gold prices hold gains in Asia after China economy data seen solid - Sean Seshadri trading Florida

Gold held gains Asia on Wednesday after solid China data sets on GDP, output and retail sales.

Gold for December delivery on the Comex division of the New York Mercantile Exchange rose 0.12% to $1,264.45 a troy ounce. Also on the Comex, silver futures for December delivery gained 0.11% to $17.657 a troy ounce, while copper futures increased 0.14% to $2.105 a pound.

China reported third quarter GDP with a quarter-on-quarter gain of 1.8% meeting expectations along with a year-on-year pace of 6.7% along with solid figures for retail sales, industrial output and fixed asset investment.

China is the world’s largest copper consumer, accounting for nearly 45% of world consumption.

Overnight, gold prices added to overnight gains in North American trade on Tuesday, as disappointing U.S. inflation data was seen as easing pressure on the Federal Reserve to tighten monetary policy, weighing on the dollar.

The U.S. Commerce Department said that consumer prices inched up 0.3% in September, matching expectations and up from 0.2% in the preceding month. Year-over-year, consumer prices increased 1.5% last month, after having risen 1.1% in August. That was its highest reading since October 2014.

Meanwhile, CPI, excluding the volatile food and energy components, rose 0.1%, missing forecasts for 0.2% and slowing from 0.3% a month earlier. In the 12 months through September, core CPI advanced 2.2%.

The disappointing report led investors to push back expectations for the next U.S. rate hike. Markets are currently pricing in a 69.5% chance of a rate hike at December's meeting, according to Investing.com's Fed Rate Monitor Tool.

Gold is sensitive to moves in U.S. rates, which lift the opportunity cost of holding non-yielding assets such as bullion. A gradual path to higher rates is seen as less of a threat to gold prices than a swift series of increases.

Oil prices edge up on tighter U.S. fuel market - Sean Seshadri Trading Tampa

Oil prices edged up on Friday, pushed by a tighter U.S. fuel market and as technical indicators attracted buying from financial players.

Following a dip in early trading, international Brent crude futures (LCOc1) were trading at $52.08 per barrel at 0149 GMT, up 5 cents from their previous close.

After falling below $50 a barrel on Thursday, U.S. West Texas Intermediate (WTI) crude (CLc1) was trading at $50.63 per barrel, up 19 cents from the last close.

Traders said the U.S. price rise was due to a tightening fuel market.

"Oil prices rose overnight despite rising stockpiles in the U.S., as fuel supplies in the U.S. fell to the lowest level this year," ANZ bank said in a morning note on Friday.

The U.S. Energy Information Administration reported a drop of 3.7 million barrels for distillates late on Thursday, which include diesel and heating oil, and a 1.9-million barrel decline for gasoline. [EIA/S]

However, U.S. crude stocks rose for the first time in six weeks , swelling by 4.9 million barrels in the week to Oct. 7 to 474 million barrels.

Outside the United States, traders said that Brent prices were being supported by technical indicators, which had attracted investment from financial market participants.

"The recent breakout above key short-term resistance levels means the path of least resistance is still to the upside for oil," Fawad Razaqzada, technical analyst at futures brokerage FOREX.com, wrote in a note.

Reuters' technical analyst Wang Tao said Brent could test resistance at $52.49 per barrel, a break above which could lead to a gain to $53.45.

Despite the slightly higher prices on Friday, there were still factors weighing on oil markets, especially doubts that a planned oil output cut by the Organization of the Petroleum Exporting Countries (OPEC) and potentially non-OPEC member Russia would be sufficient to rein in a global production overhang standing at around half a million barrels per day (bpd) in excess of consumption.

"Talk of cutting output in some quarters appears to be morphing into talks of a freeze in supply. We are doubtful that OPEC's efforts, even if successful in achieving a targeted 32.5 million bpd in collective output, will prove sufficient to materially alter the global oil balance and deliver a substantial reduction in oil inventories," French bank BNP Paribas(PA:BNPP) said in a note to clients.

OPEC's crude oil production stood at a record 33.6 million bpd in September .

NYMEX crude weaker in Asia as API reports build last week - Sean Seshadri Trading

Crude oil prices fell in Asia on Thursday after a build in U.S. supplies reported by an industry group set the tone ahead of official data from the U.S. Department of Energy later in the day.

U.S. crude futures on the New York Mercantile Exchange for November delivery fell 0.66% to $49.85 a barrel.

The American Petroleum Institute late Tuesday said crude inventories rose by 2.7 million barrels last week, following a 7.6 million draw in the previous report and that capped substantial inventory draws for the previous three weeks.

A draw of 1.35 million barrels was reported at Cushing and distillates fell by 4.5 million barrels, Gasoline inventories rose by 700,000 barrels.

Overnight, U.S. oil futures were little changed on Wednesday, hovering close to a recent four-month peak, as investors eyed a fresh round of talks between OPEC producers and other oil exporters to stabilize the global oil market.

On the ICE Futures Exchange in London, the December Brent contract ended at $51.66 a barrel.

OPEC was set to hold talks with non-member oil producers on Wednesday to try to discuss the details of an agreement to cap production for at least six months as Russia lent its support for the plan.

Russian President Vladimir Putin said on Monday that his country was prepared to join an oil-output deal which may include a production freeze or cut.
However, analysts still cautioned that a deal might fall through especially as Russia's participation remained uncertain.

Demand for the U.S. dollar still remained supported, as the odds for a December rate hike passed the 70% threshold on Tuesday.

Oil prices typically weaken when the U.S. currency strengthens as the dollar-priced commodity becomes more expensive for holders of other currencies.

Gold swings between small gains, losses in Asia ahead of U.S. jobs data - Sean Seshadri

Gold prices were mostly flat on Friday in Asia as investors awaited U.S. jobs data and the return of China to the markets next week after a week-long holiday.

Gold for December delivery on the Comex division of the New York Mercantile Exchange swung between small gains and losses around $1,235.15 a troy ounce. Silver futures for December delivery on the Comex fell 0.65% to $17.233 a troy ounce.

Market participants were focusing on Friday’s U.S. nonfarm payrolls report for further indications on the strength of the job market, as the Federal Reserve has indicated that future interest rate decisions will be data-dependent.

The consensus forecast is that the data will show jobs growth of 175,000 in September, following an increase of 151,000 in August. The unemployment rate is forecast to hold steady at 4.9%, while average hourly earnings are expected to rise 0.2% after gaining 0.1% a month earlier.

Overnight, gold prices extended overnight losses to touch the lowest level in almost four months during North America's session on Thursday, amid growing expectations for a December rate hike by the Federal Reserve.

The U.S. Department of Labor said the number of individuals filing for initial jobless benefits in the week ending October 1 decreased by 5,000 to 249,000 from the previous week’s total of 254,000. Analysts had expected jobless claims to rise by 3,000 to 257,000 last week.

First-time claims were the lowest since April, when initial applications for aid were at levels not seen since November 1973.

A strong nonfarm payrolls report would reinforce the view that a U.S. rate hike in December may be on the cards, after hawkish signals from senior Fed officials in recent weeks revived speculation of a rate hike before the end of the year. According to Investing.com's Fed Rate Monitor Tool, investors are pricing in a 63.4% chance of a rate hike by December. November odds were at 14.5%.

The precious metal is sensitive to moves in U.S. rates, which lift the opportunity cost of holding non-yielding assets such as bullion, while boosting the dollar in which it is priced.

Oil prices rise on report of U.S. crude stock draw - Sean Seshadri Trading Tampa

Oil prices rose in early trading on Wednesday after a report that U.S. fuel inventories may have fallen for a fifth straight week, but contracts remained near the $50 marker where many traders currently see fair value for crude.

U.S. West Texas Intermediate (WTI) crude futures were trading at $49.22 per barrel at 0649 GMT, up 53 cents, or 1.1 percent, from their last settlement.

In international oil markets, benchmark Brent crude was trading at $51.38 per barrel, up 51 cents, or 1.0 percent.

Traders said the higher prices were largely a result of a report by the American Petroleum Institute (API) late on Tuesday showing that U.S. crude inventories likely fell for a fifth straight week, declining by 7.6 million barrels. [API/S]

"All eyes now turn to the EIA crude inventory numbers tonight," said Jeffrey Halley, senior market analyst at brokerage OANDA in Singapore, adding that another confirmed draw in crude stocks would likely push WTI over $50 per barrel.

The U.S. government's Energy Information Administration (EIA) will report official stockpile numbers on Wednesday, although analysts polled by Reuters expect the EIA to report a stock build of 2.6 million barrels for the week ended Sept. 30. EIA.

Gary Ross, executive chairman at the New York-based consultancy PIRA, said that a planned deal by members of the Organization of the Petroleum Exporting Countries (OPEC) to cut output would likely lead to only modest price rises.

Jason Gammel of U.S. investment bank Jefferies said implementation of the deal "may prove unsuccessful" due to rivalries within the group, but he added that "the mere threat of a production cut should put a floor under oil prices until the next OPEC meeting on November 30."

Beyond the uncertainty of an OPEC-deal, Gammel said "security conditions in Nigeria and Libya seem to us the most acute uncertainties in the market," adding that if output in any of these countries recovered "that would mean a very hefty cut from the remaining OPEC members if they want to meet the output target."

ING bank also warned not to read too much into the planned OPEC production cut before details were agreed.

"This is still only a plan, and no final agreement has been made," the bank said, adding that even modest cuts face hurdles given that Iran, Nigeria and Libya have campaigned for exemptions, which would mean members such as Venezuela and Saudi Arabia would have to stomach larger cuts.

The Dutch bank said that higher prices "are possible within the coming weeks to next few months, although limited."

Gold prices edge up in Asia in thin trade with U.S. jobs in focus - Sean Seshadri

Gold prices gained on Tuesday in Asia in think trade with most attention squarely on U.S. jobs data at the end of the week for a better view of chances the U.S. Federal Reserve will hike rates before the end of the year.

On the Comex division of the New York Mercantile Exchange, gold futures for December delivery rose 0.13% to $1,314.45 a troy ounce. Silver futures for December delivery on the Comex gained 0.16% to $18.898 a troy ounce. Markets in China are shut for a week-long holiday.

Overnight, gold prices were little changed near two-week lows on Monday, as market sentiment remained supported as concerns over Deutsche Bank’s health continued to ease.

Safe-haven demand weakened following reports late last week that Deutsche Bank(DE:DE:DBKGn) is nearing a deal to settle a mortgage-securities investigation by paying a $5.4 billion fine, well below the Justice Department’s original proposal of $14 billion.

Meanwhile, gold prices were also affected by a stronger dollar after the University of Michigan said in a revised report on Friday that its consumer sentiment index hit 91.2 in September, up from a previous estimate of 89.8 and beating expectations for a reading of 90.0.

Data also showed that the Chicago purchasing managers’ index rose to 54.2 this month from 51.5 the previous month, exceeding expectations for an uptick to 52.0.

Investing.com's Fed Rate Monitor Tool shows investors estimate a 10.3% chance of a rate hike in November, and a 61.6% figure for December.

Asian shares higher in thin trade with markets in China shut this week - Sean Seshadri

Shares in Asia gained on Monday in thin trade with China markets shut for a week-long holiday and U.S. jobs data at the end of the week a key focus.

The Nikkei 225 rose 1.12%, while the S&P/ASX 200 gained 0.83%.

In Japan, the third quarter Tankan survey showed the large manufacturing index at plus-6, below the plus-8 figure expected and unchanged from the previous period.

In the second quarter survey, companies on average continued to revise down their inflation outlook for one and five years ahead from three months ago as core consumer prices, which exclude fresh food, continued to be weak and private demand remained sluggish.

The Bank of Japan is seeking to form an appropriate yield curve in order to hit its 2% inflation target under the new monetary easing framework adopted last week, Governor Haruhiko Kuroda said in a speech Thursday.At its next policy meeting Oct. 31-Nov. 1, the BoJ board will review its medium-term growth and inflation outlook through March 2019. Inflation expectations among businesses in the September Tankan due out on Tuesday will provide a clue as to whether the outlook is being revised down again.

Earlier, in Australia, the AIG manufacturing index came in at 49.8, recouping some of the sharp fall in August and moving closer to the expansion zone above 50.

"With business investment the major missing ingredient to a more comprehensive lift in domestic activity, there is a clear need for policy action in this area. In considering the Government's Enterprise Tax Plan, federal parliamentarians should consider the material improvement to the investment outlook that would come from a reduction in the company tax rate," AI Group Chief Executive Innes Willox said.

At the weekend, the semi-official PMI from the China Federation of Logistics and Purchasing (CFLP) and the National Bureau of Statistics (NBS) came in at 50.4 in September, unchanged from last week and as expected.

Markets in Germany are also shut on Monday.

In the coming week, the U.S. nonfarm payrolls report on Friday is seen by many as the clearest sign on the health of the labor market, amid ongoing speculation over whether U.S. interest rates will rise this year.

The Fed raised rates for the first time in almost a decade in December and forecast rates would rise four times this year, but officials have recently acknowledged that the mixed economic recovery means rates are likely to remain lower for longer.

The Fed’s next meeting is in November, but a rate hike ahead of the presidential election is seen as unlikely.

Last week, U.S. stocks were higher after the close on Friday, as gains in the Oil & Gas, Healthcare and Consumer Services sectors led shares higher.

At the close in NYSE, the Dow Jones Industrial Average rose 0.91%, while theS&P 500 index climbed 0.80%, and the NASDAQ Composite index added 0.81%.