Crude pares losses to end a bad week a little higher
Markets tries to shake off President Trump's trade war threats
Oil ended a bad week a little higher as the initial panic over President Donald Trump’s trade-wars threat eased somewhat.
Futures in New York rose 0.4 per cent on Friday, erasing a morning slump and paring the weekly loss to about 3.6 per cent. President Trump tweeted that “trade wars are good, and easy to win” after announcing plans for tariffs on steel and aluminum, which roiled markets across the board. But a report on US drilling showed the shale patch might be slowing down.
“For much of the day, we’ve followed the ups and downs of the equities market,” said Bart Melek, head of global commodity strategy at TD Securities in Toronto. The addition of just one oil rig this week “means that the future outlook for production in the US is probably going to be less robust in growth than what we’ve seen recently.”
Oil has fallen more than 8 per cent since late January, when prices reached a three-year high of nearly $67 a barrel, as surging US output counters efforts by Opec and allied producers to drain a worldwide glut.
West Texas Intermediate for April delivery rose 26 cents to settle at $61.25 a barrel on the New York Mercantile Exchange. Total volume traded was about 13 per cent below the 100-day average.
Brent for May settlement added 54 cents to end the session at $64.37 on the London-based ICE Futures Europe Exchange. May futures traded at a $3.28 premium to May WTI.
With the Trump administration set to impose tariffs on imported steel as soon as next week, pipeline makers who use foreign metal are bracing for a price increase. Those most at-risk may be energy haulers mapping out expansions in places like the Permian Basin, an oil field beneath Texas and New Mexico that’s pumping crude at record levels.
In the US, crude production rose to about 10.3 million barrels a day last week, the highest on record, while inventories expanded to the most in about two months. Chevron shut in production at the Alba oil field in the North Sea as a “precautionary measure” following a weather-related power outage.
Elsewhere, total bought Marathon Oil’s assets in Libya for $450 million, a rare upstream expansion in the war-torn North African nation by a major international company.
Updated: March 3, 2018 10:39 AM