Oil prices fall on profit taking

NEW YORK:

Oil prices reversed earlier gains on Friday as indications of strong Russian oil supply offset better than expected US economic growth data, strong middle distillate refining margins and hopes of a rapid recovery in Chinese demand.

Brent futures were down 51 cents, or 0.6%, at $86.96 a barrel by 1629 GMT. US crude fell 65 cents, or 0.8%, to $80.37. Both benchmarks rose by more than $1 earlier in the session but are now poised to break a three-week run of gains.

Oil loadings from Russia’s Baltic ports are set to rise by 50% this month from December as sellers try to meet strong demand in Asia and benefit from rising global energy prices, traders said and Reuters calculations showed.

Urals and KEBCO crude oil loadings from Ust-Luga over February 1-10 may rise to 1.0 million tonnes from 0.9 million in the plan for the same period of January, traders also said.

“If Russian supply remains strong heading into next month, oil is probably going to continue to trend lower,” said John Kilduff, Partner at Again Capital LLC. He added that profit taking ahead of the weekend may also have driven prices lower.

OPEC+ delegates meet next week to review crude production levels, with sources from the oil producer group expecting no change to current output policy.

Published in The Express Tribune, January 28^th, 2023.

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