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News: Brent above US$62 as Kuwait talks up the market

  1. Brent crude held above US$62 per barrel, close to its highest level for 2015, after Kuwait’s oil minister claimed the oil surplus was now definitely lower than 1.8mln barrels per day.

    Ali al-Omair, the Kuwaiti minister, said oil prices would be supported through the second half of 2015.

    It comes after many international oil companies slashed capital budgets, scaled back growth projects and reduced exploration activity.

    In the United States drilling activity has slowed markedly, according to recent statistics, though this apparent curtailment has yet to translate into reduced surpluses. Department of Energy inventory figures revealed a near 5mln barrel rise in crude stockpiles to 417.9mln barrels.

    This was the latest all-time high for the weekly measure of inventories.

    Outside the US, however, the threat of geopolitical instability and supply disruption provides another potential floor for crude prices. Concerns include the escalating conflicts with ISIS - now involving Egypt and Libya.

    In London trading on Monday Brent crude gained almost 1% to change hands just above US$61 per barrel, whilst West Texas Intermediary futures were down slightly at US$52.75.

     

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