(Bloomberg) - Oil traded near a three-month high in New York as investors look ahead to next month’s OPEC meeting and as Hurricane Matthew threatened to disrupt fuel shipments along the U.S. East Coast.
Futures fluctuated after rising 9.3 percent the previous four sessions. Matthew is threatening to shut in about 33 million barrels of oil storage in the Bahamas and disrupt Caribbean shipping this week before heading northwest toward the U.S. East Coast. OPEC agreed to trim supply for the first time in eight years last week. Quotas will be decided at the group’s official meeting in Vienna on Nov. 30. A U.S. government report Wednesday is projected to show crude supplies rose last week.
Oil in September capped the biggest monthly gain in five months after the Organization of Petroleum Exporting Countries’ accord. OPEC crude production rose to a record in September, according to a Bloomberg survey. Rising prices have drawn explorers back to the U.S. shale patch. Rigs targeting crude in the nation rose to the highest level since February, Baker Hughes Inc. said on its website Friday.
"We’re seeing a shift in speculator sentiment after the OPEC agreement caught them by surprise," said Rob Haworth, a senior investment strategist in Seattle at U.S. Bank Wealth Management, which oversees $133 billion of assets. "We’re reassessing the chances of OPEC eventually coming to an agreement and positioning before tomorrow’s inventory report."
West Texas Intermediate for November delivery rose 12 cents to $48.93 a barrel at 11:33 a.m. on the New York Mercantile Exchange. The contract reached $49.13, the highest intraday level since July 5.
Brent for December settlement climbed 27 cents, or 0.5 percent, to $51.16 a barrel on the London-based ICE Futures Europe exchange. Prices reached $51.37, the highest since June 10. The global benchmark traded at a $1.67 premium to WTI for December delivery.
"The speculators are gunning for $50 dollars and will then head for $51.67, which was the wave high that we touched back in June," said Bob Yawger, director of the futures division at Mizuho Securities USA Inc. in New York. "The OPEC meeting next month is on the horizon. I don’t think that we’re moving on fundamentals though."
OPEC boosted output by 170,000 barrels a day in September to 33.75 million barrels a day, the Bloomberg survey of analysts, oil companies and ship-tracking data showed. Nigeria and Libya added a combined 190,000 barrels a day which compensated for a drop in output from Saudi Arabia and Angola.
Production from Nigeria and Libya is returning after internal unrest crippled the countries’ oil infrastructure. Together with Iran, they will likely be exempt from the preliminary deal to cut output.
Gasoline futures climbed 1.9 percent as the storm was forecast to head northward along the East Coast, potentially reaching New York Harbor, the delivery point for Nymex contracts. That may disrupt shipments temporarily as tankers change course to avoid the hurricane.
U.S. crude inventories probably increased by 1.5 million barrels last week, rising for the first time in five weeks, a Bloomberg survey showed before the Energy Information Administration report on Wednesday. Gasoline inventories probably expanded by 500,000 barrels.
BP Plc’s Clair offshore field near the U.K.’s Shetland Islands is still shut following an oil leak. Chinese gasoline will reach the U.S. East Coast for the first time in nine years as a surge in New York prices helps ease a glut in Asia.
- With assistance from Grant Smith. To contact the reporter on this story: Mark Shenk in New York at email@example.com To contact the editors responsible for this story: David Marino at firstname.lastname@example.org Jim Efstathiou Jr., Carlos Caminada
Copyright 2016 Bloomberg News.
WHAT DO YOU THINK?
Click on the button below to add a comment.
Generated by readers, the comments included herein do not reflect the views and opinions of Rigzone. All comments are subject to editorial review. Off-topic, inappropriate or insulting comments will be removed.
Most Popular Articles
From the Career Center
Jobs that may interest you