Bearish Sentiment Returns To Oil Markets

Crude Oil

The West Texas Intermediate (WTI) for November delivery picked up 0.37 USA dollar to settle at 71.34 dollars a barrel on the New York Mercantile Exchange on Friday.

Output, which includes crude oil, natural gas liquids, biofuels and refinery processing gains, was 2.3 million barrels above the same period a year ago and 1.3 million barrels a day higher than the second quarter.

The IEA warned that recent peaks in supply and demand have put a strain on spare capacity. In the group's updated oil supply and demand forecasts released Thursday, they cut their demand estimates due to expectations for lower economic growth while supplies should increase from non-OPEC producers, writes Reuters.

A drop in US oil production also lent prices some support.

The monthly report by the International Energy Agency (IEA) on Friday weighed on crude markets.

US light crude dropped $1.42, or 1.9%, to $71.75 USA after hitting a low of $71.63.

The monthly report from the Organization of the Petroleum Exporting Countries showed the 15-nation producer group's output rose by 132,000 bpd in September to almost 32.8 million bpd. The Organization of the Petroleum Exporting Countries (OPEC) made a similar move on Thursday.

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At one point, Kavanaugh could be seen having a lighthearted exchange with liberal Justice Elena Kagan, seated next to him. Circuit, typically deals with ethics complaints, but he apparently stepped aside from complaints against Kavanaugh.

Wall Street extended its slide into a sixth session and a global equity index fell to a 1-year low on Thursday as investors feared an escalating USA trade war with China and risks from a recent climb in interest rates. OPEC, Russia and other U.S. shale producers had increased production since May, raising global oil output by 1.4 million barrels per day (bpd).

Crude inventories climbed by 6 million barrels in the week to October 5, the U.S. Energy Information Administration reported, compared with analyst expectations for an increase of 2.6 million barrels.

'The bearish alarm bells are ringing for next year's oil balance as market players brace for the return of a supply surplus, ' said Stephen Brennock of oil broker PVM.

Greg McKenna, chief market strategist at futures brokerage AxiTrader said the USA crude price support came "as the EIA inventory data showed a big draw in US crude and a solid run rate of 98.1 percent for refineries".

"The clear risk-off mode that we are seeing across all markets is also hitting oil", said Michael McCarthy, chief market strategist at CMC Markets in Sydney.

Michael crashed ashore Florida on Wednesday as the third most powerful hurricane to strike the United States mainland.

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