Oil prices
dipped on Friday following slight gains in the previous session and
analysts said the outlook remained weak, with production high and
producers reducing operating costs to adjust to lower export revenues.
Global oil prices had
firmed slightly on Thursday but not before U.S. crude hit a
near-six-year low and benchmark Brent pared gains on data showing fresh
additions to record-high U.S. oil inventories.
Brent crude oil futures opened Friday's trading little changed at $49.15 a barrel and had slipped to $48.83 by 0645 GMT. U.S. WTI futures were trading at $44.54 a barrel, barely changed.
The market found some support from China, where new commercial crude reserves regulations are likely to boost import demand in the short term.
Chinese refineries will be expected to store enough crude for 15 days of average throughput, the country's top economic planner said this week, forcing many commercial oil traders to import crude in the short term to meet the requirements.
Although
the new criteria will only have to be met gradually over a period of
one to three years, depending on the age of each facility, traders said
many refiners would take the opportunity to cover their stocks soon,
while prices are low.
Despite this short-term support from China, analysts said the overall market outlook remained weak as producers were keeping output high and adjusting to a lower-price environment.
"It looks increasingly difficult to see any voluntary supply cutbacks in commodity markets," ANZ bank said in a research report. "Falling energy prices and exchange rates are having a material impact on bottom lines, allowing producers to potentially ride out current price weaknesses."
ANZ said that the collapse in the Russian rouble currency, which has lost 50 percent of its value against the dollar over the past six months, was having a particularly strong impact on oil markets.
Yet oil prices seem to have found at least temporary support around current levels since the beginning of the year.
With gains above $50 a barrel for Brent unlikely in current conditions, price swings have been less pronounced since the beginning of the year.
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| A worker fills up a car with fuel at a gas station in Caracas, January 12, 2015. |
Brent crude oil futures opened Friday's trading little changed at $49.15 a barrel and had slipped to $48.83 by 0645 GMT. U.S. WTI futures were trading at $44.54 a barrel, barely changed.
The market found some support from China, where new commercial crude reserves regulations are likely to boost import demand in the short term.
Chinese refineries will be expected to store enough crude for 15 days of average throughput, the country's top economic planner said this week, forcing many commercial oil traders to import crude in the short term to meet the requirements.
Although
the new criteria will only have to be met gradually over a period of
one to three years, depending on the age of each facility, traders said
many refiners would take the opportunity to cover their stocks soon,
while prices are low.Despite this short-term support from China, analysts said the overall market outlook remained weak as producers were keeping output high and adjusting to a lower-price environment.
"It looks increasingly difficult to see any voluntary supply cutbacks in commodity markets," ANZ bank said in a research report. "Falling energy prices and exchange rates are having a material impact on bottom lines, allowing producers to potentially ride out current price weaknesses."
ANZ said that the collapse in the Russian rouble currency, which has lost 50 percent of its value against the dollar over the past six months, was having a particularly strong impact on oil markets.
Yet oil prices seem to have found at least temporary support around current levels since the beginning of the year.
With gains above $50 a barrel for Brent unlikely in current conditions, price swings have been less pronounced since the beginning of the year.
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