MARKET WATCH: NYMEX, Brent crude benchmarks turn lower

Light, sweet crude oil for October fell by 66¢ to settle just above $55/bbl on Sept. 12 while Brent for November dropped 43¢ to settle under $61/bbl.

Light, sweet crude oil for October fell by 66¢ to settle just above $55/bbl on Sept. 12 while Brent for November dropped 43¢ to settle under $61/bbl.

“Hopes were raised ahead of the OPEC+ JMMC meeting in Abu Dhabi that the group would do more to support the price of oil. This after Saudi Arabia, in need of $80/bbl to balance its budget, appointed oil veteran Prince Abdulaziz bin Salman (ABS), as its new energy minister. Despite promises from Iraq, Nigeria, and Russia to cut production to their agreed target levels, the market again turned lower. This after monthly oil market reports from the three major forecasters all raised concerns about the continued decline in global demand growth. Something that led the International Energy Agency to warn that the market may face a looming supply glut into 2020,” said Ole Hansen, head of commodity strategy at Saxo Bank.

“Brent and WTI crude oil’s attempted breakout lasted less than a week and both have returned to their respective ranges around $60/bbl and $55/bbl. We suspect that nervous rangebound trading will continue with any renewed risk-off from failed trade talks or deteriorating economic data keeping the market on the defensive,” Hansen said.

On Sept. 12, US President Donald Trump indicated to reporters that while he would prefer a complete agreement with China regarding trade, he would consider an interim deal.

“A lot of people are talking about it, I see a lot of analysts are saying an interim deal—meaning we’ll do pieces of it, the easy ones first. But there’s no easy or hard. There’s a deal or there’s not a deal. But it’s something we would consider, I guess.”

The statement contradicts an earlier one from a White House official that said the US is not considering an interim agreement.

Energy prices

Light, sweet crude oil on the NYMEX for October delivery decreased 66¢ to $55.09/bbl on Sept. 12 while the November contract fell 62¢ to $55.05/bbl.

The October gas price increased 2¢ to settle at $2.57/MMbtu on Sept. 12.

Ultralow-sulfur diesel for October decreased nearly 1¢ to $1.89/gal. The NYMEX reformulated gasoline blendstock for October fell a nearly 2¢ to a rounded $1.55/gal.

Brent crude for November fell 43¢ to $60.38/bbl. The December contract decreased 48¢ to settle at $59.46/bbl.

Gas oil for September was unchanged at $589.50/tonne on Sept. 12.

The average for OPEC’s basket of crudes for Sept. 12 was $60.51/bbl, down $1.57.

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