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Oil prices slip on trade frictions, but crude market remains tight

U.S. West Texas Intermediate (WTI) crude futures were at $73.19 a barrel at 0337 GMT, down 26 cents, or 0.4 percent from their last settlement. WTI on Thursday hit its highest since November 2014 at $74.03 per barrel.

June 29, 2018 / 09:38 AM IST
In the winter of 1925, a Topical Press Film cameraman made a silent record of the Company’s operations in Persia. The 35mm film, entitled ‘The Persian Oil Industry’, was 45 minutes long and shown to specialised audiences in technical institutions. Later, a 15 minute film was produced and shown in public cinemas under the title of ‘In the Land of the Shah’ and a 20 minute version bearing the same title was made for distribution by Pathescope Limited. The film, in its various forms, was seen by nearly a million people between 1926 and 1938. The approximate cost of the film was £1,600.00. Which company is being discussed here?

In the winter of 1925, a Topical Press Film cameraman made a silent record of the Company’s operations in Persia. The 35mm film, entitled ‘The Persian Oil Industry’, was 45 minutes long and shown to specialised audiences in technical institutions. Later, a 15 minute film was produced and shown in public cinemas under the title of ‘In the Land of the Shah’ and a 20 minute version bearing the same title was made for distribution by Pathescope Limited. The film, in its various forms, was seen by nearly a million people between 1926 and 1938. The approximate cost of the film was £1,600.00. Which company is being discussed here?

Oil prices dipped on Friday amid concerns about trade frictions between the United States and other major economies, although crude market conditions remain tight due to supply disruptions and generally high demand.

U.S. West Texas Intermediate (WTI) crude futures were at $73.19 a barrel at 0337 GMT, down 26 cents, or 0.4 percent from their last settlement. WTI on Thursday hit its highest since November 2014 at $74.03 per barrel.

Brent crude futures were at $77.73 per barrel, down 12 cents, or 0.2 percent from their last close.

Friday's falls came as Asian stock markets were near nine-month lows amid an escalation of trade disputes between the United States on one side and economies including China, India and the European Union on the other.

China's yuan slipped to a new low against the U.S.-dollar on Friday and was on course for its worst month on record, as the increasingly bitter trade row with the United States threatened to rattle the world's second-biggest economy.

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Unless the disputes get resolved, traders worry that tariffs on imported goods will start feeding into other markets, including oil.

Eventually, world economic growth will be choked off, analysts said.

Commodities brokerage Marex Spectron said this week that the macroeconomic outlook was "overwhelmingly bearish."

Traders said Friday's dip was also a result of profit-taking. Greg McKenna, chief market strategist at futures brokerage AxiTrader said this week's crude price rises had "exhausted the bulls."

Despite the gloomy outlook for global trade, oil markets for now remain tight.

North America's oil markets have tightened significantly as an outage of Canada's Syncrude has locked in over 300,000 bpd of production. The outage is expected to last at least through July, according to operator Suncot.

Outside North America, oil prices have been rallying for most of 2018 due to record demand and voluntary supply cuts led by the Middle East dominated producer cartel of the Organization of the Petroleum Exporting Countries (OPEC).

Oil demand has been chasing records for most of the year, and OPEC has said it will raise output in order to meet demand and replace crude from unplanned disruptions.

Looming U.S. sanctions against OPEC-exporter Iran are also fuelling Brent prices.

Unplanned supply disruptions from Libya to Venezuela have helped to further tighten the market.
Reuters
first published: Jun 29, 2018 09:33 am

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