WTI Oil Heads for Weekly Loss With Brent as Demand SlowsGrant Smith
West Texas Intermediate crude headed for a weekly loss amid concerns that global oil demand is slowing. Brent slipped in London.
WTI futures were little changed after paring an advance of as much as 0.9 percent in New York. The grade has lost 0.4 percent this week, while Brent has retreated 2.8 percent in the same period. The International Energy Agency cut world oil demand forecasts for this year and 2015 yesterday.
“The latest price slide was due first and foremost to a gloomier demand outlook,” Carsten Fritsch, an analyst at Commerzbank AG in Frankfurt, said in a report. “It would still be premature to talk of a trend reversal” after the sell-off, he said.
WTI for October delivery rose 8 cents to $92.91 a barrel in electronic trading on the New York Mercantile Exchange as of 2:01 p.m. London time. It had advanced as much as 84 cents to $93.67 a barrel. The volume of all futures traded was about 9 percent above the 100-day average for the time of day.
Brent for October settlement slipped 8 cents, or 0.1 percent, to $98 a barrel on the London-based ICE Futures Europe exchange. The European benchmark crude traded at a premium of as little as $4.85 to WTI on ICE, the least since July 24.
Global demand will increase by 1.2 million barrels a day, or 1.3 percent, to 93.8 million barrels a day next year, the Paris-based IEA said in a report yesterday. The expansion is 165,000 barrels a day less than it predicted a month ago. Second-quarter growth in consumption slid to a 2 1/2-year low, spurring Saudi Arabia’s shipments to the lowest since September 2011, the agency said.
Oil prices are poised to decrease next year as U.S. crude production reaches a 45-year high, the Energy Information Administration said Sept. 9. WTI will average $94.67 a barrel in 2015 versus the August projection of $96.08, the government forecaster said in its monthly Short-Term Energy Outlook. It trimmed its Brent crude estimate for next year to $103 a barrel from $105.
The U.S. will “deepen and broaden” measures against Russia’s financial, energy and defense industries, President Barack Obama said in a statement yesterday, hours after an announcement of new sanctions by the European Union.
“Oil prices look to be bottoming now following the rather steep sell-off over the past week,” Jens Naervig Pedersen, an economist at Danske Bank A/S in Copenhagen, said by e-mail. “Some upside risks prevail due to the re-escalating geopolitical tensions.”