Brent settled steady and U.S. crude slightly lower on Monday after prices were whipsawed by volatility as Saudi Arabia pledged to work toward oil price stability but traders worried about a global supply glut and signs of rising U.S. stockpiles.
Crude oil prices are once again drifting lower after the API reported another huge build in crude oil stocks late Tuesday afternoon. The API reported a 6.3 million barrels build for the seventh weekly build in a row of builds even as the U.S. refining sector continues to increase refinery utilization rates as they return from the fall maintenance season.
Any sense of bullish optimism seemed to get lost after the American Petroleum Institute blindsided the market with a reported 6. 3 million barrel build in crude oil supply. The number was about 5 times larger than market expectations and came as traders were trying to asses conflicting reports from different reporting agencies and conflicting OPEC comments. In the end though, after the whopping increase in weekly supply, the focus turned to the near term oil glut.
Oil is unlikely to return to $80 a barrel before the end of the decade, despite unprecedented declines in investment, as yearly demand growth struggles to top 1 million barrels per day, the International Energy Agency said on Tuesday.
While OPEC continues to talk tough about oil production, the International Energy Agency is warning that its strategy may backfire on them. This comes the day after the United Arab Emirates Energy Minister Suhail Mohamed al-Mazrouei is saying the UAE plans to double down in the OPEC price war by raising production in the next few years to 3.5 million barrels a day, up from 2.9 million barrels per day. He is predicting that the drop in oil prices is almost over and soon prices will start to rise.
President Obama never had any intention of approving the Keystone Pipeline. In a cruel manner he kept TransCanada waiting for a decision regarding the pipeline as he stalled, lacking the courage to be honest and kill the pipeline--all because he feared a negative political backlash from unions and the American people, all of whom supported the building of the pipeline.