Forex Marketz Daily Forex News – Fully Markets Update
U.S. crude oil futures shed over $1 a barrel in Asian trade today. There was a rise in U.S. drilling as well as higher OPEC output reported. This put the brakes on the current rally. The rally that saw prices soar higher, with their biggest third quarter gain in 13 years has now ended.
U.S. energy companies added oil rigs for the first week in seven, according to data. Iraq announced its exports increased in September, when OPEC boosted output.
U.S. WTI light sweet crude ended this morning’s session down $1.09, or 2.1 percent, to settle at $50.58. The U.S. benchmark had posted its strongest quarterly gain since the second quarter of 2016.
The global benchmark Brent Crude, by 6:20 pm GMT, fell 85 cents, or 1.5 percent, to $55.94 a barrel. Brent has seen a third-quarter gain of around 20 percent. This was its biggest third quarter gain since 2004. It had traded as high as $59.49, as of last week.
OPEC and Supply hits Crude Oil Hard
The recent rally in oil was being driven by that the three yearlong glut in global supply was easing. It was being helped by a production cut scheme in place by members of the Organization of the Petroleum Exporting Countries (OPEC).
Brent has gone from strength to strength as surplus inventories, around the globe, were being depleted. This rally was also supported by a tighter physical market. In turn, this provided a fundamental backbone to support the black gold.
However, recent economic data, showed that OPEC oil output rose last month. It was up thanks to higher supplies from Iraq and Libya. Libya is an OPEC member that is exempt from cutting output, in the current deal.
The gain in Libyan production might be short lived. The country’s largest oilfield, Sharara, is now closed. It has been closed since Sunday, thanks to problems.
