Oil hovers at seven-month low as investors weigh up supply issues

Oil prices held steady Tuesday on the heels of seven-month lows, with investors remaining dubious about how effective the production cuts spearheaded by Saudi Arabia and Russia have been and will be.

Futures have skidded 17% since New Year’s, which is when the output-cap agreement went into effect. The deal’s stated objective has been bringing global crude inventories down to five-year averages.

Read: Oil ends at 7-month low after failing to shake off supply worries

But the results have been largely disappointing thus far.

Morgan Stanley pointed out that identifiable oil inventories — both oil and products in the Organization for Economic Cooperation and Development, China and selected other non-OECD countries — increased some at a rate of around 1 million barrels a day in the first quarter.

“OPEC still have a long way to go in rebalancing the market,” said Stuart Ive, a client manager at OM Financial.

On the New York Mercantile Exchange, light, sweet crude futures for delivery in July

CLN7, +0.27%

 recently traded up 0.2% at $44.27 a barrel in the Globex electronic session. August Brent crude

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