Oil prices fall as higher US rig count offsets OPEC strategy

27/03/2017 Argaam
by Nadeshda Zareen

Crude futures declined on Monday as rising US rig count undermined OPEC’s talks to extend its oil output cap deal beyond the first half of this year.

 

Global benchmark Brent crude was last down 0.8 percent at $50.42 a barrel (bbl) and WTI crude fell 1 percent to $47.49/bbl.

 

“Brent prices are holding just above 200-day SMA (simple moving average) and trend line support at $50.74 to $50. WTI is holding just above $46.75-$47.18. These are the bull’s support levels,” Bank of America Merrill Lynch said in a note Sunday.

 

“Another decline in oil prices through these support levels is bearish,” it added.

 

US oil rigs rose by 21 to 652, according to Baker Hughes data for the week ending March 24.

 
Oil prices have been climbing since OPEC and non-OPEC producers agreed to slash production in a bid to shore up prices and rebalance global oil markets. Brent hit $56/bbl last month, but has since declined to $50-level as US crude inventories and rig count remain on the rise.

 

Data from the US Energy Information Administration showed that US crude inventories rose 5 million barrels to 533.1 million for the week ending March 17.

 

Write to Nadeshda Zareen at nadeshda.zareen@argaamplus.com

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