top of page

Oil Trades Near $30 as Iran Loads Cargo, China Imports Decline

Oil traded near $30 a barrel as Iran loaded its first cargo to Europe since international sanctions ended and Chinese crude imports dropped from a record.

West Texas Intermediate futures were little changed in New York, paring earlier losses of as much as 1.7 percent. Brent in London traded near $33 a barrel. A tanker for France’s Total SA was being loaded Sunday at Kharg Island while vessels chartered for Chinese and Spanish companies were due to arrive later the same day, an Iranian oil ministry official said. Chinese imports in January fell almost 20 percent from the previous month, according to government data.

“Iran is going to add headwinds to the market,” David Lennox, an analyst at Fat Prophets in Sydney, said by phone. “We still have 500 million barrels of U.S. inventories and shale producers are still pumping. Until there are significant cuts to output, the rally is not sustainable.”

Oil in New York is down about 21 percent this year amid the outlook for increased Iranian exports and BP Plc predicts the market will remain “tough and choppy” in the first half as it contends with a surplus of 1 million barrels a day. Speculators’ long positions in WTI through Feb. 9 rose to the highest since June, according to data from the U.S. Commodity Futures Trading Commission.

WTI for March delivery was at $29.37 a barrel, down 7 cents on the New York Mercantile Exchange at 7:39 a.m. London time after earlier falling as much as 49 cents to $28.95. The contract gained $3.23, or 12 percent, to close at $29.44 on Friday after dropping 19 percent the previous six sessions. Total volume traded was about 11 percent above the 100-day average. WTI prices lost 4.7 percent last week.

Brent for April settlement was at $33.41 a barrel on the London-based ICE Futures Europe exchange, up 5 cents. The contract climbed $3.30 to close at $33.36 on Friday. The European benchmark crude was at a premium of $1.59 to WTI for April.

Iran, which was the second-biggest producer in the Organization of Petroleum Exporting Countries before sanctions were intensified in 2012, is seeking to boost output by 1 million barrels a day and regain market share after penalties were lifted. Total, Spanish refiner Compania Espanola de Petroleos and Russia’s Lukoil PJSC all booked cargoes to sail from Kharg Island to European ports, according to shipping reports compiled by Bloomberg earlier this month.

In the U.S., drillers idled rigs for an eighth week to the lowest level since January 2010, according to data from Baker Hughes Inc. The number of active rigs dropped by 28 to 439, the company said on its website Friday.

Speculators’ long position in WTI rose by 1,152 contracts to 302,384 futures and options, according to CFTC data. Shorts, or bets that prices will decline, slipped 2.1 percent. Net-longs increased 5 percent to a three-month high.

China’s crude imports declined to the lowest in three months as state refiners slowed operations amid swelling stockpiles of fuel. The world’s largest energy consumer in January cut imports by 4.6 percent from a year ago to 26.69 million metric tons, or about 6.3 million barrels a day, according to preliminary data released Monday from the General Administration of Customs in Beijing. Imports reached a record 33.2 million tons in December.

via- Bloomberg Business

Recent Posts


Follow Us

  • Grey Facebook Icon
  • Grey Twitter Icon
  • Grey LinkedIn Icon
bottom of page