Oil Up As Canada, Nigeria’s Problems Counter Stockpile Concerns | Independent Newspapers Limited
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Oil Up As Canada, Nigeria’s Problems Counter Stockpile Concerns

Posted: May 11, 2016 at 5:38 am   /   by   /   comments (0)


Oil rose on Tuesday, boosted by supply disruptions in Canada and elsewhere that have knocked out 2.5 million barrels of daily production and temporarily eclipsed concern over high global inventories and a looming surplus of refined products, reports Reuters.

Brent crude futures were up 39 cents on the day at $44.02 per barrel by 1200 GMT, while U.S. crude futures were virtually flat at $43.38 per barrel.

In spite of output outages from Canada to Nigeria, oil prices are down by more than 2 percent so far this week, hampered by worries that even hefty dents to production will have little effect on the growth of stocks of unwanted crude.

Weekly data on speculative holdings of crude futures has shown investors are cooling a little towards oil.

“We’ve seen the market slump 10 percent from the highs since this (Canada) news came in, which suggests that there are other fish to fry at the moment,” Saxo Bank senior manager Ole Hansen said.

“The big reaction yesterday to the change in Canada gave an indication that the market has become a bit more focused on selling into rallies…”

A series of attacks on Nigeria’s oil infrastructure has pushed its output of crude close to a 22-year low, Reuters data shows, piling pressure on its finances.

“Despite some significant supply disruptions, most notably in Canada, ongoing bearish fundamentals precipitated a modest retracement in prices,” Societe Generale said in a weekly note to clients.