Crude oil ended mixed. New York crude edged down 0.2 percent to its lowest close in nearly two weeks

Nov. 17 - Crude oil ended mixed, with New York crude closing at its lowest level in more than a week, as lower expectations of a DRAWdown the U.S. Strategic Petroleum Reserve offset pressure on production growth.

On Tuesday, Nymex West Texas Intermediate (WTI) crude for December delivery fell 12 cents, nearly 0.2%, to settle at $80.76 a barrel, the lowest close since Nov. 4. ICE January Brent rose 38 cents, 0.5%, to settle at $82.43 a barrel in Europe. The futures had fallen for two consecutive sessions.

Prices were supported by comments Steny Hoyer, the Majority leader in the U.S. House of Representatives. His comments lowered market expectations that the U.S. would release its strategic crude oil reserve to help lower gasoline prices. But on Tuesday, the International Energy Agency said it expected rising production to help ease global supply constraints, putting some pressure on crude prices.

"The market now thinks it's unlikely that The U.S. will release strategic crude reserves to help lower high gasoline prices," said Phil Flynn, senior market analyst at The Price Futures Group in Chicago.

Us House of Representatives Majority Leader Steny Hoyer reportedly said on Tuesday that he disagreed with Senate Majority Leader Chuck Schumer's recent call to release strategic crude oil reserves to help lower gasoline prices. Separately, Stephen Nalley, acting administrator of the U.S. Energy Information Administration (EIA), told a U.S. Senate committee hearing on domestic international energy price trends that the impact of the strategic crude release would be "transitory."

"Clearly, common sense may take hold, because everyone knows that releasing strategic crude reserves to lower gasoline prices is a short-term band-aid that doesn't solve the underlying problem," Flynn said.

Schneider electric (commodities analyst Christine Redmond said in a daily report "in the monthly report, the organization of petroleum exporting countries the international energy agency, said the global oil market may become a glut before the end of this year, the former said the fragile recovery due to popular demand, while the latter is pointed out that the production of a recent trend of strong earnings."

"In the last few months, Permian production has grown strongly," she said. The U.S. government expects oil production in the Permian region to reach a record in December. In its monthly report released Monday, the EIA forecast oil production in the Permian region to increase by 67,000 barrels per day to 4.95 million barrels per day in December.

In its monthly report released Tuesday, the International Energy Agency said the tight supply-demand balance in the global oil market could ease. Oil production is expected to rise by 1.5 million barrels a day for the rest of 2021, with the United States, Saudi Arabia Russia accounting for about half of that, the IEA said.

Flynn said the IEA "does look to U.S. energy producers to pick up the slack," but may be "overly optimistic about what's going to happen next year, especially with new regulations the Biden administration." In a monthly report last week, Opec cut its growth forecast for this year, citing the impact of high oil prices.

Traders were also focused on developments related to Iran. Reports say Iran has resumed production of advanced components equipment for its nuclear program, reducing the chances of Iran reaching a deal with world powers to revive a 2015 nuclear deal aimed at curbing its nuclear program. At the same time, Flynn said data showing better-than-expected U.S. retail sales gave the Fed "more leeway" to scale back asset purchases raise interest rates.

Separately, St. Louis Federal Reserve Bank President James Bullard suggested on Tuesday that the Fed should raise interest rates twice next year speed up its tapering of bond purchases. Those comments caused oil prices to fall back early Tuesday, Mr. Flynn said.

Analysts expect EIA reported crude oil inventories to fall by an average of 2.5 million barrels, gasoline stocks by 100,000 barrels distillate stocks by 1.3 million barrels in the week ended November 12, according to a survey by S&P Global Platts.

In other energy products traded on exchanges, gasoline for December rose 0.9% to $2.35 a gallon. December heating oil rose 1.34% to $2.431 a gallon. Natural gas futures for December delivery rose 3.2% to $5.177 per million British Thermal units, as European gas prices rose after German regulators suspended the certification process for the Nord Stream 2 pipeline, which carries gas Russia to Germany.

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Source: financial network

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