Crude Oil Prices Settle Lower But Sentiment Remains Bullish

Investing.com – WTI crude oil prices settled lower as investors appeared to take profits on the sharp rally this week but sentiment remained positive amid ongoing OPEC-led output cuts and the prospect of geopolitical tensions disrupting supplies.

On the New York Mercantile Exchange for May delivery fell 1.3% to settle at $64.30 a barrel, while on London’s Intercontinental Exchange, fell 0.70% to trade at $64.30 a barrel.

Crude oil prices struggled to extend their recent rally after hitting a nearly seven-week high of $65.69 a barrel as investors took profits on WTI’s more than 3% rally so far this week which following a surprise draw in crude stock piles and rising geopolitical tensions.

Inventories of U.S. crude fell by 2.622 million barrels for the week ended March 16, confounding expectations for of 2.6 million barrels.

Morgan Stanley said it forecasts an “under-supplied market in 2018,” woudl make inventories even tighter amid geopolitical tensions.

“On May 12, the US government will need to decide on the renewal of the waiver of Iranian sanctions, Morgan Stanley said.”

“Depending on the outcome, this could affect Iranian exports, including possibly taking a few hundred thousand barrels per day off the market.”

The bank also cited the risk of a dip in Venezuelan output as an additional factor that support oil prices.

“Any restrictions imposed by the US government on diluent exports from the US or crude imports from Venezuela into the US could lead to a further decline in overall production, the bank added”

The bank did, however, warn that a “common pushback” to its call for an under-supplied oil market was rising US shale.

U.S. output rose to a record 10.4 million barrels per day last week as domestic producers edged closer to matching Russia’s output of 11 million barrels per day.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.