Crude oil prices retreated from 2019 highs Friday as worries about the global economy and booming U.S. supply growth resurfaced.
The International Energy Agency reported signs of tightening oil supplies as OPEC and Russia curb production, but the IEA also predicted strong U.S. supply growth ahead.
“The relentless pace continues into 2019, when U.S. supply is expected to expand by 1.5 million bpd and account for 83% of non-OPEC growth of 1.8 million bpd,” the Paris-based watchdog group said in its monthly report. “What is game changing is that the U.S. in 2021 will become a net oil exporter on an annual average basis.”
It went on to say the rise of the U.S. “crucially” enhances security of global supplies, as geopolitical tensions rise. Expanding U.S. production and spare capacity in OPEC and Russia could help keep a lid on rising crude oil prices.
The IEA also noted that increasing Canadian production has pushed its exports to U.S. refineries, freeing up U.S. crude for export.
“This year, U.S. seaborne oil trade will move into surplus with net exports rising to nearly 4 million bpd by 2024,” it said.
Crude Oil Prices
West Texas Intermediate crude oil prices, the U.S. benchmark, fell 0.2% to settle at $58.52 a barrel, after pegging a 2019 high of $58.95.
Brent crude oil prices, the global benchmark, lost 0.1% to end at $67.16 per barrel, after hitting a 2019 high of $68.14 Thursday.
For the week, U.S. crude oil prices gained 4.4%, and Brent climbed 2.2%.
Exxon Mobil (XOM) was flat on the stock market today and Chevron (CVX) rose 0.6%. Shares of both Dow Jones Industrial Average components sit above both the 50-day and 200-day moving averages on the back of a massive rally year to date.
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