Bearish EIA Report Drove Market into $57.79 - $55.99 Value Zone

  • Bearish EIA Report Drove Market into $57.79 - $55.99 Value Zone

Bearish EIA Report Drove Market into $57.79 - $55.99 Value Zone

The sun sets behind an oil pump outside Saint-Fiacre, near Paris, France September 17, 2019.

Crude oil futures gained 0.78 percent to Rs 4,132 per barrel on January 16 as participants increased their long position after US President Donald Trump and Chinese Vice Premier Liu He signed "Phase One" of the trade deal.

U.S. Treasury Secretary Steven Mnuchin said late on Tuesday that tariffs on Chinese goods will remain in place until the completion of a second phase of a U.S. "China trade deal has given optimism for a revival in global manufacturing, and thus stronger oil demand growth", said Bjarne Schieldrop, Oslo-based chief commodities analyst at SEB AB.

Concerns about increasing supply also pressured prices after a government report on Tuesday said that output from the USA, now the world's largest producer, will increase in 2020 by more than previously forecast.

"While China's phase-one commitments are welcomed, US pork exports continue to be suppressed because of the country's 60 per cent punitive tariffs", National Pork Producers Council President David Herring said in a statement.

Soybeans futures in Chicago fell 1.2 per cent, cotton slipped 1.1 per cent and hog futures we down 0.4 per cent. U.S. West Texas Intermediate crude is 0.4 per cent lower, while natural gas fell 2.8 per cent.

OPEC raises 2020 global oil demand growth forecast by 0.14 million barrels per day. The pessimism was in contrast to comments at the White House by President Donald Trump, who said U.S. energy producers and farmers would benefit.

Shares of Cheniere Energy Inc., the largest U.S. LNG exporter, rose as much as 2.6% in NY trading as the broader equities market gained, while rival Tellurian Inc. was up as much as 2.7%. The American Petroleum Institute reported inventories expanded by 1.1 million barrels last week, according to people familiar with the data. Gasoline and distillate inventories also climbed.

While U.S. crude oil production is set to continue to rise, energy-related carbon dioxide (CO2) emissions in America are expected to have dropped past year and to continue falling through 2021, the Energy Information Administration said on Friday.