HOUSTON: Oil held steady on Thursday after strong earnings from Meta and Microsoft supported US equities and postponement of US-Iran talks offset concerns about the US economy and the prospect of higher OPEC+ oil output.
US West Texas Intermediate crude futures eased 15 cents or 0.3% to $58.04 a barrel by 12:30 p.m. ET (1630 GMT). Brent crude futures fell 18 cents or 0.2% to $60.90. Both contracts fell over 1% earlier. “Crude remains in the crosshairs of lower prices near term as OPEC+ is signaling production, which will likely get approval at next week’s OPEC meeting,” said Dennis Kissler, senior vice president of trading at BOK Financial.
“The GDP number for the US showed a slight contraction and consumer confidence has also drifted lower, which has pushed most long hedge funds away from the buying side of crude on demand concerns,” Kissler added.
Wall Street stocks rallied and gold prices slid on Thursday as solid earnings from big tech bolstered investor risk appetite. Meanwhile, a fourth round of talks between the United States and Iran, which had been due to take place in Rome on Saturday, has been postponed and a new date will be set “depending on the US approach,” a senior Iranian official told Reuters on Thursday. Concern about higher supply also weighed on prices.
Saudi Arabia is telling allies and industry experts that it is unwilling to prop up the oil market with supply cuts and can manage a prolonged period of low prices, sources told Reuters. Several OPEC+ members will suggest the group accelerates output hikes in June for a second consecutive month, three people familiar with OPEC+ talks have said. Eight OPEC+ countries will meet on May 5 to decide a June output plan. Meanwhile, the US economy contracted for the first time in three years in the first quarter, data showed on Wednesday, swamped by a flood of imports as businesses raced to avoid higher costs from tariffs and underscoring the disruptive impact of President Donald Trump’s unpredictable trade policy.
Trump’s tariffs have made it probable the global economy will slip into recession this year, a Reuters poll suggested.
US crude oil stockpiles fell unexpectedly by 2.7 million barrels last week on higher export and refinery demand, the Energy Information Administration said on Wednesday, compared with analysts’ expectations in a Reuters poll for a 429,000-barrel rise.
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