Oil prices just can’t get enough of bears despite the latest bullish news. The Saudi Arabian crude exports are in five months low despite record production, while the accelerated U.S. drilling output seen few weeks ago appeared to peter out.
The U.S. crude and international futures are in three week losing-streak on rumors of rising exports from Iran after a deal to lessen sanctions against the Islamic Republic and member of OPEC.
Brent September crude oil price was $56.95 a barrel by 0547 GMT, 15 cents lower. That means 3 percent of benchmark fall last week and more than 10 percent for the month.
The West Texas Intermediate (WTI), were down at $50.67 on Monday. The last week dipped 3 percent and more than 14 percent in the month. On Tuesday the August contract expires as well and is likely to fall further.
The major oil producer Saudi Arabia shipped 6.935 million barrels a day in May, significantly lower result compared with 7.737 barrels per day in April.
The Saudi Kingdom is still the biggest crude oil exporter with over 10 million barrels per day record output but also investing big amount of money to become an oil refining hub.
In the States shale oil drillers slashed seven oil rigs in previous week, according to report by Baker Hughes (NYSE:BHI) Inc.
“At current prices, shale is supremely challenged and demand could pose an upside surprise,” HotForex analysts explained in a note to clients.
At Goldman Sachs (NYSE:GS) analysts predict $60 barrel West Texas Intermediate prices in the following weeks, “U.S. producers will ramp up activity given improved returns with costs down nearly 30 percent and producers increasingly comfortable (with the current economics).”
Schlumberger NV (NYSE:SLB) expects rising demand for oilfield services in North America in the coming quarters, a region that has been clobbered by the sharp fall in oil prices.
The U.S. Commodity Futures Trading Commission reported on Friday investors abandoning net long U.S. crude futures and options positions in the week to July 14.
Russian Energy Minister Alexander Novak and OPEC Secretary-General Abdullah al-Badrisaid will meet in Moscow on July 30 to talk about the Iran situation and oil markets.