Oil prices mixed, dollar hits year peak

Oil futures were mixed today, with Brent adding one percent while US crude lost ground, as the dollar index hit July 14, 2017 highs, following earlier data from the US, the world's largest energy consumer, while markets price in chances of Saudi production cuts after the government stated "We don't want to push crude into the market past the need of our clients". 

As of 04:10 GMT, US crude futures due on August 15 rose 1.11% to $69.52 a barrel from the opening of $68.76, while Brent futures due on September 15 shed 0.12% to $72.81 a barrel from the opening of $72.90, as the dollar index added 0.45% to 95.51 from the opening of 95.08. 

Stellar US Employment Data 

Earlier US data showed unemployment claims fell 8 thousand to 207 thousand from 215K, beating expectations of 220K, while continuing claims for the week ending July 7 rose 8 thousand to 1.751 million from 1.743 million, missing estimates of 1.729 million. 

The Philly Fed Manufacturing Index rose to 25.7 in July from 19.9 in June, beating estimates of 21.6, while the CB leading index rose 0.5% in June, beating estimates of 0.4%, and compared to May's no-change. 

Surprise Buildup 

The Energy Information Administration released its report on US crude inventories, showing a buildup of 5.8 million barrels in the week ending July 13, compared to a 12.6M drop in the previous reading, while analysts expected a 3.6M decline, with total stocks now up to 411.1 million barrels, which is 2% below the five-year average for this time of year.

Gasoline stocks on the other hand fell 3.2 million barrels, still 5% above five-year averages, while distillate stocks, including heating fuel, fell 0.4 million barrels, making them 13% below averages. 

Libya's state oil corporation halted deliveries at the Zaiwa terminal due to low production after the Sharara oil field, one of the largest in the country, was hit by an attach, with five workers kidnapped.  

US Oil Rig Count 

Baker Hughes reported no change in the US oil rig count last week at 863 rigs, already the highest since March 2015. 

US production has jumped 29% from mid-2016 levels to a total of 10.9 million bpd, a record high, passing Saudi Arabia's 10.7 million bpd, and nearing Russia's 11.1 million bpd