Brent oil slipped in a volatile session on Feb. 21 as persistent concerns about global economic growth outweighed supply curbs and prompted investors to take profits on the previous day's gains.
The focus in the wider financial market is firmly on the release on Feb. 21 of the minutes of the U.S. Federal Reserve's latest meeting, after recent data raised the risk of interest rates remaining higher for longer.
Global benchmark Brent crude was down 44 cents, or 0.5%, at $83.63/bbl by 1435 GMT. U.S. West Texas Intermediate crude for March, which expires on Feb. 21, was up 32 cents at $76.66.
"Markets are very choppy after a very slow start to the week and crude is no different," said Craig Erlam of brokerage OANDA.
"While China's recovery could lift oil prices over the coming months, global concerns are weighing, so we aren't quite seeing it being fully priced in."
The market rallied, with Brent briefly turning positive, after better than expected business activity surveys in Europe and the U.K. pointed to a less gloomy European economic outlook than previously feared.
On Feb. 20 oil prices rose by more than 1% on optimism over Chinese demand that analysts expect to rebound this year after COVID-19 restrictions were scrapped.
The U.S. crude contract did not settle on FEb. 20 because of a public holiday in the United States. As a result, the weekly American Petroleum Institute report on U.S. inventories will be out on Feb. 22 rather than the usual Tuesday, Feb. 21.
Signs of tighter supply also lent prices some support.
Russia plans to cut oil production by 500,000 bbl/d, or about 5% of its output, in March after the West imposed price caps on Russian oil and oil products over the invasion of Ukraine.
Russia is part of the OPEC+ producer group comprising the Organization of the Petroleum Exporting Countries (OPEC) and allies, which agreed in October to cut oil production targets by 2 MMbbl/d until the end of 2023.
Recommended Reading
Cheniere’s Next Corpus Christi LNG Stage Online by Year-end
2024-05-13 - Cheniere executives are optimistic the first LNG cargo will depart from Train 1 of its Corpus Christi Stage 3 project by the end of 2024, and that the company will bring all seven trains at the project online before the end of 2026.
NextDecade Raises ‘Going Concern’ Doubts Amid Rio Grande LNG FID
2024-05-13 - NextDecade, which is developing the Rio Grande LNG project in Brownsville, Texas, highlighted “going concerns” amid plans to take a final investment decision on Phase 2 of the project by year-end 2024.
US Drillers Cut Oil, Gas Rigs for Third Week in a Row
2024-05-10 - Baker Hughes said oil rigs fell three to 496 this week, their lowest since November, while gas rigs rose one to 103.
Kissler: Mideast Tension Elevates Crude Prices—But for How Long?
2024-05-09 - Producers should be aggressive in locking in desirable crude oil prices on an abnormal market strength.
Exclusive: Scott Tinker Says Pausing LNG Ups Coal Use
2024-02-20 - In this Hart Energy LIVE Exclusive interview, Scott Tinker, chairman of Switch Energy Alliance, talks about energy security globally, and dives into the effects of the Biden administration's LNG pause.