oil stabilizes as dollar continues to fall off 2-year high

Crude oil futures fluctuate higher during the Asian session as the dollar fell for the fifth session in seven sessions from its highest since June 21, 2017, according to the reverse relationship between them, while on the eve of developments and economic data expected on Friday from the US economy, the world's largest consumer and oil producer.

US crude oil futures (April delivery) rose 0.17% to trade at $58.63 per barrel, compared with the opening at $58.51 a barrel. Brent crude futures rose (15 May) 0.13% to trade at $67.25 per barrel, compared to the opening at $67.13 per barrel, while the dollar index declined 0.06% to 96.66 compared to the opening at 96.72.

Markets are currently waiting for the US economy to release the New York Manufacturing Index, which may extend to 10.1 vs. 8.8 in February. Before the world's largest industrial producer release the reading of the Industrial Production Index (IPI), which might show an increase to 0.4% versus -0.6% of decline in January, While the Energy Use Intensity (EUI) reading showed accelerated growth to 78.5% versus 78.2%.

Leading to the first reading of the University of Michigan Index of Consumer Sentiment, which may reflect a widening to 95.5 versus 93.8 in February, with the release of consumer Inflation Expectation (MICH) for one year to come and five years ahead, in conjunction with the release of a statistical Job Openings and Labor Turnover (JOLTS) that may reflect a decrease to 7.27 million versus 7.34 million last December.

Otherwise yesterday, some reports referred to the postponement of the upcoming summit between the US President, Donald Trump, and his Chinese counterpart, Xi Jinping, to next April, in contrast to the initial report of the summit later this month, which in one way or another has revived concerns about existing trade tensions Between Washington and Beijing despite the recent efforts from both parties to resolve their trade disputes and reach a trade agreement.

In another context, we followed Wednesday the US Energy Information Administration report for oil inventories showed a deficit of 3.9 million barrels during the last week on the seventh of this month compared to surplus of 7.1 million barrels in the previous weekly reading, contrary to expectations that indicated a reduction of surplus to 2.7 million barrels, Inventories to 449.1 million barrels, while stocks remain 2% higher than the average of the past five years for this time of year.

In the same context, the report of the US Energy Information Administration showed that the stocks of motor fuel in the United States declined 4.6 million barrels, while inventories remain 2% higher than the average for the past five years for this time of the year, while increased stocks of distillate derivatives, which include Heating fuel 0.4 million barrels, but stocks are still 1% below the average of the past five years for such a time of year.

On the other hand, we followed Thursday the OPEC on its monthly report, which lowered its expectations for global demand for oil this year in the shadow of increased competitors for the Organization production, which justifies the growing possibility of extension of the Organization and its allies to reduce global production by 1.2 million barrels per day to the end of this year, which is supposed to be renewed by the middle of this year.

The Organization of the Petroleum Exporting Countries (OPEC) expects the world demand for its oil to reach 30.46 million barrels per day in 2019, lower than its previous forecast by 130 thousand barrels per day, explaining that although the growth of global demand for oil is expected to moderate at this year, But that growth is much lower than the expected strong growth in non-OPEC world oil supplies.

In the same context, the Organization confirmed in its monthly report the joint responsibility of participating in the agreement to reduce production by producing countries of opec and its allies, to avoid new shocks In the oil markets and to continue to support the stability of the markets during the current year.

 OPEC  the Secretary-General of OPEC "Mohammed Barkindo" expressing that the possibility of the adoption of the "NOPEC" new bill within the United States, which is to sue OPEC because of its role in the rise of oil prices does not meet the interests of the United States, noting the the organization follow that bill inside the US Congress with interest, adding that the bill has now gained more and more supporters.

Barkindo noted that this is not in the interest of the United States itself nor in favor of the growing oil industry at the moment, and comes hours after he said on Tuesday that the work to restore balance to oil markets is still maintained by OPEC and its allies producers, noting that shale oil companies in the United States have benefited from OPEC's efforts to reduce global oil production, which has boosted oil prices.

Earlier this week, the International Energy Agency (IEA) revealed warnings in its annual report, which reviewed its oil market forecasts over the next five years, of the consequences of Britain's exit from the EU without an agreement and trade tensions that negatively impact global demand for oil. which may lead to the weakening of international trade and demand for oil .

The International Energy Agency (IEA) forecast higher demand for jet fuel as air travelers numbers increase around the world and demand for petrochemicals grow, boosting global demand for oil, which could rise from 100.6 million bpd in 2019 to 106.4 million bpd by 2024, This came in conjunction with the report on the return of oil production in the largest oil fields in Libya, the "Sharara" field.

In another context, the Saudi Energy Minister Khalid al-Falih said on Sunday it was too early to change OPEC's production policy at the group meeting in April, expressing the fact that China-the largest importer of energy globally and the United States-the largest industrial country-will lead to strong global demand for oil this year.

Khalid al-Faleh said that the world demand for oil is expected to increase by 15 million barrels per day. If Venezuela is seen alone, there will be a sense of panic about the lack of oil production. but If the United States is seen in the same spot, there will be a feeling that the world is full of oil, while noting the importance of looking at the market as a whole, with his statement that the expectations reflect the possibility of strong global demand for oil during the current year 2019.

And according to the weekly report of Baker Hughes, which was released last Friday, the drilling rig and oil drilling in the United States fell by 9 platforms to a total of 834 platforms during the past week to the 7th of March, otherwise, the report said the US Energy Information Administration Recently that US oil production rise by 100 thousand barrels per day to its highest ever at 12.1 million barrels per day.