SINGAPORE, Jan 27: Oil prices were little changed on Tuesday, with Brent holding above $48 following comments from a top OPEC official that prices may have found a floor. OPEC Secretary-General Abdullah al-Badri said oil prices may have bottomed out and could rise very soon. He also warned of a risk of a future price spike to $200 a barrel if investment in new supply capacity is too low.
‘Crude oil markets continue to consolidate near term,’ ANZ analysts said in a note, adding that Brent traded in the range of $48-$50 last week and has shown little direction. ‘OPEC’s Secretary General commented yesterday that prices may have bottomed but there was no imminent prospect of OPEC producers sitting down to discuss cutbacks until mid-year,’ the analysts said.
West Texas Intermediate (WTI) crude for March delivery was up 5 cents at $45.20 a barrel by 0124 GMT, after slipping to a session low of $44.35 on Monday, close to a near 6-year low. March Brent crude rose 6 cents to $48.22 a barrel, after settling down 1.3 percent on Monday. The international benchmark has lost nearly 60 percent from June in a rout fuelled by ample global supplies from the U.S. shale oil boom and a decision by OPEC to keep its production quotas unchanged.
‘I’m not sure if prices have bottomed out, but I can see some signs for prices to rebound,’ said Yusuke Seta, a commodity sales manager at Newedge Japan, referring to a rise in Brent’s open interests in the past few weeks.
Brent’s open interest hit 1.64 million lots in the week of Jan. 20, a record high since the data started in 2011. WTI may come under further pressure this week as commercial crude stockpiles likely rose by nearly 4 mln barrels last week, a Reuters survey showed on Monday, after posting its largest build in 14 years in the previous week.
The data stretched Brent’s premium to WTI to more than $3 a barrel last week after trading close to parity earlier. (AGENCIES)
Follow our WhatsApp channel