Oil steady in timid trade ahead of holiday season
By Henning Gloystein
SINGAPORE (Reuters) – Oil prices were steady on Tuesday in timid trading ahead of the year-end holidays, with investors beginning to unwind positions without expecting to take up new ones until the start of 2017.
International Brent crude oil futures <LCOc1> were trading at $54.98 per barrel at 0759 GMT, down up 6 cents from their last close.
U.S. West Texas Intermediate (WTI) crude oil futures <CLc1> were down 15 cents at $51.97 per barrel.
Traders said they were starting to square their books ahead of the upcoming Christmas weekend and the week running up to New Year.
As a result, and barring major price-moving news, they said markets would likely remain tepid this week.
“I think we can safely say that pending any dramatic headline we will bounce around the $54-$56 (per barrel) range on Brent until year-end,” said Matt Stanley, fuel broker at Freight Investor Services (FIS) in Dubai.
Jeffrey Halley, senior market analyst at OANDA brokerage in Singapore, said “a light news week and the run-in to the holiday season” were keeping markets quiet.
Reports late on Monday that Saudi Arabian crude oil exports fell by 176,000 barrels per day (bpd) in October had initially supported markets, but the effect later fizzled out due to an increase in Saudi exports of refined fuel products.
Saudi Arabia’s rising refined product output is part of a wider trend.
Asia is seen posting its biggest net refining capacity additions in three years in 2017, further boosting demand for crude in the world’s biggest and fastest growing oil consuming region.
The increase amounts to about an additional 1.5 percent of refining capacity on top of Asia’s total installed capacity of nearly 29 million bpd.
Still, traders see no outright supply shortage for Asian refineries, as OPEC is shielding most of its Asian customers from the planned cuts.
(Reporting by Henning Gloystein; Editing by Kenneth Maxwell and Christian Schmollinger)