Forex Marketz Daily Forex News – Fully Markets Update
Crude oil prices got off to a weak start this morning during Asian trade hours. Investors are worried about rising drilling activity in the United States which means more output. In turn this fuels concerns about the global oversupply.
As of 2 am GMT, U.S. West Texas Intermediate (WTI) crude futures were fetching $62.02 a barrel. This was down 32 cents from their last close.
Brent crude futures, the international benchmark, were trading at $65.87 per barrel. This was down 34 cents.
Monday’s weakness was partially reversed by a rise seen Friday. That increase came due to rising tensions in the Middle East
Going by supply versus demand, the markets are facing a risk of returning to a supply glut after being in a small deficit in 2017.
Crude Oil Traders Watch US Rig Counts
U.S. drillers added four oil rigs for the week ending on March 16. This brought the total rig count to 800. This data comes from Baker Hughes and was released on Friday.
The U.S. rig count, a forward indicator for future output, is higher than a year ago. There were only 631 rigs active rigs in the U.S. Energy companies continue to boost spending since 2016 when crude prices started to rebound from a two year crash.
Thanks to the high drilling activity, U.S. production has risen more than 20 percent since 2016. It is now at 10.38 million barrels per day and above exporter Saudi Arabia.
Only Russia produces more. They pump at around 11 million barrels per day. U.S. output is expected to overtake Russia’s later this year.
