BD Forex News- Crude prices edged up in Asia on Tuesday as markets looked ahead to comments by U.S. Vice President Mike Pence in Tokyo on continued tension on the Korean peninsula and ahead to industry estimates on U.S. crude and refined product inventories.
On the New York Mercantile Exchange crude futures for May delivery rose 0.09% to $52.70 a barrel, while on London’s Intercontinental Exchange, Brent was last quoted at $55.36 a barrel.
Pence was in South Korea on Monday, where he visited the demilitarized zone (DMZ). Pence noted that U.S. “era of strategic patience” with North Korea was over and that “all options are on the table” when it came to Pyongyang.
The American Petroleum Institute (API) will release its estimates of crude and refined product stockpiles at the end of last week on Tuesday in the U.S. with early analyst estimates expecting a 1.5 million barrels drop in crude stocks, a 960,000 barrels fall in distillates and a 2.0 million barrels decline in gasoline supplies.
Last week, official data from the Energy Information Administration (EIA) showed a 2.166 million barrels drop in crude stocks. The EIA releases official data on crude and refined product inventories on Wednesday.
Overnight, crude settled lower on Monday, despite bullish Chinese economic data, as investors weighed the impact of a ramp-up in U.S. oil production against OPEC efforts to drain the global glut in supply.
Crude prices had notched three straight weeks of gains to recover from the slump in March, when prices fell to a five-month low of $47.01, on the back of concerns rising levels of U.S. oil production would dampened OPEC’s efforts to cut supply.
Some analysts, however, remained adamant that OPEC-led cuts would offset rising levels of U.S. shale production. U.S. shale oil output is forecast to rise by 123,000 barrels per day (bpd) in May to 5.19 million bpd, the U.S. Energy Information Administration said on Monday.
Meanwhile, market participants look ahead to OPEC’s next meeting, scheduled for May 25; it is widely expected that OPEC members will announce the extension to the current deal to cut global oil supply.
In November last year, OPEC and other producers, including Russia agreed to cut output by about 1.8 million barrels per day (bpd). The deal to cut supply began at the start of the year for period of six months until June.
Saudi Energy Minister Khalid al-Falih told Al-Arabiya television on Monday it is too soon to comment on whether a coordinated pact to trim domestic oil supplies to the market in the first half of the year will be extended.
