Published: Wed, August 15, 2018
Money | By Armando Alvarado

Oil tumbles as much as 2% as Oklahoma crude piles up

Oil tumbles as much as 2% as Oklahoma crude piles up

The futures markets were further weakened late in the session after data from industry group the American Petroleum Institute (API) showed that US crude stocks unexpectedly rose by 3.7 million barrels the week-ending August 10, compared with analysts' expectations for a drawdown of 2.5 million barrels.

"Discount is part of the nature of the global markets being offered by all oil exporters", IRNA reported the source as saying on Monday. US light crude was up 90 cents at $68.10.

Also on Monday, a monthly OPEC report showed oil production in Saudi Arabia unexpectedly fell last month from June.

The US benchmark crude has declined more than 4percent this month as global trade disputes threatened to deflate energy demand growth.

"Short-term credit conditions continue to deteriorate which is likely to have an outright negative impact on the demand for crude oil in the medium term".

To be sure, the most likely scenario, according to the cartel, is that the trade spat continues between the USA and China, and "the most likely case will not have a significant impact on global GDP or oil demand growth in 2018 and 2019".

Earlier, there were concerns about supply shortage as an outcome of Trump's sanctions on Iran and war of words which led to oil prices marking a sweeping move to three and a half year highs. Iran is OPEC's third-largest oil producer - behind Saudi Arabia and Iraq - and now pumps around 3.65 million barrels per day, according to Reuters data.

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Moreover, looming concerns over slowing global economic growth amid escalating trade and geopolitical tensions continue to act as a drag on the prices.

Danish Danske Bank sees the U.S.

The United States and China have been locked in a tit-for-tat trade spat for a few months, gradually adding tariffs to each others' products in a dispute that threatens to curb economic activity in both countries.

The trade dispute is also boosting the USA dollar against emerging-market currencies, and oil consumers in those countries pay more for oil in their local currencies, another potential risk to demand growth.

"It's a strong dollar situation".

Headed to 8-month lows of $ 65.72 amid weak fundamentals.

"We do not think that Saudi Arabia is interested in seeing Brent crude below $70 a barrel", said SEB commodities analyst Bjarne Schieldrop.

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