By Claudia Assis and V. Phani Kumar, MarketWatch
SAN FRANCISCO (MarketWatch) — Crude-oil futures traded lower Thursday, extending losses to a second day as Saudi Arabia said it is able to increase supplies to counter oil’s high prices.
Crude-oil futures for May delivery CLK2 -1.66% slipped $1.21, or 1.1%, $104.13 a barrel on the New York Mercantile Exchange.
Saudi Arabia’s oil minister, Ali al-Naimi, wrote in a Financial Times opinion piece on Thursday that the giant oil exporter “would like to see a lower price” and that geopolitical concerns, not inadequate supplies, are helping to keep prices high. Read FT opinion piece.
“Saudi Arabia has invested a great deal to sustain its capacity, and it will use spare production capacity to supply the oil market with any additional required volumes,” Naimi wrote in the article. “We have [reliably increased supplies] many times before, and we will do it again.”
Read the View From Jerusalem column on how the Saudis have failed to reverse oil-market trends.
The front-month contract fell $1.92 on Wednesday. The drop came after a French official said France, along with the U.S. and U.K., is consulting the International Energy Agency about the possibility of releasing oil reserves to curtail price increases, according to the Financial Times. Read analysis of how big oil consumers are jawboning the market.
High oil prices have been threatening to stall a fragile economic recovery in several countries around the world.
“Market participants still cannot tip the price scale to either the bullish or the bearish camp,” analysts at VTB Capital said in a note. “On the one hand, continuing supply jitters are getting more fuel each week ... And even now, with Iran allegedly ready to restart negotiations over its controversial nuclear program in early April, fears of a full blown military conflict continue to haunt market participants.”
Saudi Arabia’s oil minister, Ali al-Naimi, wrote in a Financial Times opinion piece on Thursday that the giant oil exporter “would like to see a lower price” and that geopolitical concerns, not inadequate supplies, are helping to keep prices high. Read FT opinion piece.
“Saudi Arabia has invested a great deal to sustain its capacity, and it will use spare production capacity to supply the oil market with any additional required volumes,” Naimi wrote in the article. “We have [reliably increased supplies] many times before, and we will do it again.”
Read the View From Jerusalem column on how the Saudis have failed to reverse oil-market trends.
The front-month contract fell $1.92 on Wednesday. The drop came after a French official said France, along with the U.S. and U.K., is consulting the International Energy Agency about the possibility of releasing oil reserves to curtail price increases, according to the Financial Times. Read analysis of how big oil consumers are jawboning the market.
High oil prices have been threatening to stall a fragile economic recovery in several countries around the world.
“Market participants still cannot tip the price scale to either the bullish or the bearish camp,” analysts at VTB Capital said in a note. “On the one hand, continuing supply jitters are getting more fuel each week ... And even now, with Iran allegedly ready to restart negotiations over its controversial nuclear program in early April, fears of a full blown military conflict continue to haunt market participants.”
Claudia Assis is a San Francisco-based reporter for MarketWatch.
Varahabhotla Phani Kumar is a reporter in MarketWatch's Hong Kong bureau.
