Economy

Oil slips below $62 on rise in US inventories

Oil slips below $62 on rise in US inventories

The losses were said to be a reaction to USA government data showing new orders for us -made goods fell in November, especially for machinery and electrical equipment, as well as Genscape reporting that crude inventories at Cushing, Oklahoma rose by over 943,000 barrels in the week to February 1.

National Security Adviser John Bolton and Treasury Secretary Steven Mnuchin announce sanctions against Venezuela state-owned oil company PDVSA and embattled president Nicolas Maduro.

A flotilla loaded with about seven million barrels of Venezuelan oil has formed in the Gulf of Mexico, some holding cargoes bought ahead of the latest USA sanctions and others whose buyers are weighing whom to pay, according to traders, shippers and Refinitiv Eikon data.

On the positive side and somewhat limiting occasional dips, crude oil prices remain supported by the ongoing OPEC+ deal to curb production, supply disruptions from Venezuela and Libya and the continuation of United States sanctions against Iranian exports.

Guaido's team is planning for a post-Maduro government with an emergency scheme to supply fuel domestically, given widespread shortages across Venezuela, Goicoechea said.

U.S. West Texas Intermediate (WTI) crude futures were at $54.77 per barrel at 0223 GMT, up 21 cents or 0.4 percent. USA crude was down 48 cents at $53.18.

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"Anything out of the State of the Union that hints at the US-China deal not working out, or more anti-trade rhetoric would be a negative for energy prices as demand would be lower if global growth keeps being downgraded", said Alfonso Esparza senior market analyst, OANDA.

The producers known as OPEC+ started cutting production by 1.2 million barrels per day (bpd) from last month to avert a new supply glut, and OPEC has delivered nearly three quarters of its pledged cuts already, a Reuters survey showed last week.

"The collapse in oil prices late a year ago has resulted in more cautious spending by U.S. oil explorers", said Dhar.

Still, some observers have pointed out that the weakened state of its oil industry may have only a limited effect on the wider global crude market.

Venezuela, like fellow OPEC members Iran and Libya, was exempt from production curbs under the OPEC+ deal on expectations that its output faced involuntary downward pressure in 2019. -China trade dispute. Oil prices fell on Tuesday after a survey showed euro zone business expansion almost stalled in January.

Last week, China said its manufacturing activity contracted for the second-straight month in January, another sign that the world's second-largest economy is slowing down amid domestic headwinds and the on-going trade dispute with the U.S.