Oil Up 4th Wk as Geopolitical Risk Offsets Oversupply


   
Barani Krishnan
DTN Refined Fuels Market Reporter

   SECAUCUS, NJ (DTN) -- Oil futures closed up for a fourth consecutive week on 
Friday (1/16) as geopolitical risks curbed traders from adding substantially to 
short positions despite U.S inventory builds that heightened glut fears.

   Crude prices had a turbulent week, surging nearly 5% in the first three 
sessions on concerns over the security of Iranian supply, before tumbling 4% on 
Thursday (1/15) alone. With Friday's modest rise, key crude benchmarks added to 
three prior weeks of gains.

   NYMEX WTI crude for February delivery settled up by $0.25, or 0.4%, at 
$59.44 bbl. The ICE Brent crude contract for March finished up by $0.37, or 
0.6%, at $64.13 bbl.

   For the week, WTI rose by 0.5% while Brent tacked up by 0.4%.

   Downstream, NYMEX ULSD futures for February delivery settled up by $0.0539 
at $2.2407 gallon, and front-month RBOB closed up by $0.0014 at $1.7852 gallon.

   The U.S. Dollar Index was little changed, rising by 0.04 points to 99.39 
against a basket of foreign currencies.

   This week's swing in oil prices came from dizzying developments in Iran, 
where thousands of civilians were killed in demonstrations against the regime 
of the Islamic republic, which consistently produces about 3.2 million bpd, 
according to OPEC.

   Geopolitical risk premiums soared when U.S. President Donald Trump 
encouraged the protestors and warned Tehran of airstrikes if it killed more 
people. Trump eventually backed down, saying the situation has appeared to 
stabilize in Tehran.

   Weekly inventory data from the U.S. Energy Information Administration on 
Wednesday showing higher balances for gasoline and crude offset some of the 
bullish sentiment.

   Gasoline stockpiles rose for a 10th straight week last week rising by 9 
million bbl while crude inventories tacked on 3.3 million bbl.

    




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