Oil holds near 2019 highs ahead of official U.S weekly data
* OPEC cancels April meeting, extends output cuts to June
* U.S. officials fear China pushing back in trade talks
* Brent forward curve in backwardation: https://tmsnrt.rs/2FmG9XK
* U.S. crude stocks seen rising last week -poll
* API U.S. oil data shows surprise crude inventory draw
(Updates with U.S. industry group oil inventory data)
By Laila Kearney
NEW YORK, March 19 (Reuters) - Oil prices held close to
four-month highs on Tuesday on expectations that OPEC would
continue production cuts through the end of the year and ahead
of official weekly U.S. crude inventory data.
Brent crude oil futures settled 7 cents higher at
$67.61 a barrel, the global benchmark's highest settlement since
U.S. West Texas Intermediate (WTI) futures touched
its highest since November at $59.57 a barrel but finished at
$59.03 a barrel, falling 6 cents.
Prices inched up in post-settlement trade after data from
the American Petroleum Institute (API), an industry group,
showed a surprise draw-down on crude inventories.
Crude stocks fell by 2.1 million barrels in the week to
March 15, to 446.8 million, compared with analysts' expectations
for an increase of 309,000 barrels, the data showed.
Official Energy Information Administration (EIA) figures are
expected on Wednesday.
Oil prices have rallied more than 20 percent since the
Organization of the Petroleum Exporting Countries and its allies
began to curb supplies at the start of the year.
After a short gathering in Azerbaijan, the producer group on
Monday scrapped its planned meeting in April and will decide
instead whether to extend output cuts in June, once the market
has assessed the impact of U.S. sanctions on Iran and the crisis
Some analysts expressed concern that the cancellation was
related to tension between Saudi Arabia, the de facto head of
OPEC, and Russia, the largest producing non-member of the group
that agreed to production cuts last year.
The move to cancel the meeting favored Russia over Saudi
Arabia, which originally wanted to use the meeting to extend
output curbs until the end of the year, Commerzbank said in a
note. OPEC will next meet in June.
"However, I think OPEC and non-OPEC producers are determined
to get the supply and demand dynamics better into balance," said
Andy Lipow, president of Lipow Oil Associates in Houston.
Both benchmarks weakened after Bloomberg reported U.S.
officials were concerned Beijing was pushing back against
Washington's demands during trade talks, lowering hopes for a
resolution to the tariff war that has threatened global oil
"That kind of tanked the market a little bit," said Bob
Yawger, director of futures at Mizuho in New York. "Now we're
basically at the mercy of the API and the EIA."
Due to a tighter supply outlook for the coming months, the
Brent forward curve has gone into backwardation since
the start of the year, meaning prices for immediate delivery are
more expensive than barrels for delivery in the future.
(Additional reporting by Dmitry Zhdannikov in London; Editing
by Marguerita Choy and Leslie Adler)
First Published: 2019-03-19 02:38:52
Updated 2019-03-19 23:12:25
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