US crude stocks fell 9.5 million barrels in the week to July 5, more than triple the 3.1 million barrel draw analysts had expected, as refineries ramped up output, the country’s Energy Information Administration (EIA), said.
The report followed data from the American Petroleum Institute (API), an industry group, on Tuesday that had boosted oil prices earlier.
Reuters reported that major oil firms began evacuating and halting production in the Gulf of Mexico after weather forecasts warned that a tropical disturbance might become a storm yesterday (Wednesday) or today.
Chevron Corporation, Royal Dutch Shell, BP, and BHP Group were in the process of removing staff from 15 offshore platforms.
ExxonMobil said it was “closely monitoring” the disturbance to determine if its facilities might be affected.
The Gulf of Mexico is home to 17 percent of United States crude oil output, which stands at around 12 million barrels per day (bpd).
OPEC to Rollover Crude Oil Output Cut Deal
OPEC is to roll over a deal on cutting crude supplies at a meeting next week and discuss deepening the curbs that have been in place since January 1, 2019. A deal between OPEC and allies, including Russia, to curb oil output by 1.2 million barrels runs out at the end of June.
With the expiration of the agreement this week, the group has scheduled meetings from July 1-2 in Vienna, Austria to discuss the next steps.
However, Iraq’s Oil Minister, Thamer Ghadhban, has said the group would extend the current deal and consider deeper production cuts.
He said the issue would be discussed in Vienna but declined to specify what alternative level of cuts were being suggested.
“The rollover at least would be at the same level because it has not been very effective, it has been effective to a certain level to minimize the glut in the market, but there are now ideas or calls for agreeing (on) even more,” Ghadhban said on the sidelines of the CWC Iraq Petroleum Conference in London.
Reuters reported that Algeria had floated an idea of deepening the cut by some 600,000 bpd, to make it 1.8 million barrels per day.
Oil prices hit their highest in about a month on Wednesday, buoyed by United States government data that showed a larger-than-expected drawdown in crude stocks as exports hit a record high, and surprise drops in refined product stockpiles.
The price of the global benchmark, Brent crude, which dropped to $65 per barrel yesterday, had risen $1.44, or 2.2 per cent to settle at $66.49 a barrel on Wednesday, while the US West Texas Intermediate (WTI) crude futures rose $1.55, or 2.7 per cent, to settle at $59.38 a barrel.
The product drawdown comes at the same time as news that the largest and oldest refinery on the US East Coast would be shut after a massive fire last week caused substantial damage.
According to agency reports, Philadelphia Energy Solutions plans to shut down the 335,000 bpd refinery complex next month.
The crude inventory fall and refinery outage added to uncertainty over oil supplies created by the war of words between Washington and Tehran.
This has prompted fears that oil shipments through the Strait of Hormuz, the world’s busiest oil supply route, could be disrupted.
Asked if a war was brewing, US President Donald Trump told Fox Business Network on Wednesday: “I hope we don’t but we are in a very strong position if something should happen.”
Tehran has condemned a fresh round of US sanctions, describing it as “mentally retarded.”
But the US Special Representative on Iran, Brian Hook, told Reuters in an interview yesterday that the United States’ policy of maximum economic pressure on Tehran was working.
Democrats begin bid to oust Trump
The first of back-to-back nights of debate took place on Wednesday with 10 of the 20 Democratic presidential candidates in the United States who qualified for the debate going head-to-head on a range of issues, including healthcare, immigration and US foreign policy towards Iran.
Senators Cory Booker, Amy Klobuchar, and Elizabeth Warren, Representatives Tulsi Gabbard and Tim Ryan, Washington Governor Jay Inslee, New York City Mayor Bill de Blasio, former Representatives Beto O’Rourke and John Delaney and former Secretary of Housing and Urban Development Julian Castro took the stage Wednesday night in Miami, Florida.
Liberal firebrand Elizabeth Warren, who has been gaining momentum, took center stage at the heated forum in Florida.
Candidates sparred over healthcare and immigration, and a couple of underdogs gulped much-needed political oxygen with a few well-timed zingers.
Ten other Democrats in the crowded field, including Joe Biden and Bernie Sanders, will battle on Thursday night.
In the two-hour debate in Miami, the candidates at times engaged in shouting matches as they vied to grab the limelight.
Ms. Warren, who has been surging in opinion polls, was one of only two contenders to say she supports replacing private medical insurance with government-run healthcare.
Taking aim at her rivals, Ms. Warren drew loud applause as she said: “There are a lot of politicians who say, ‘oh, it’s just not possible’… what they’re really telling you is, they just won’t fight for it.”
“Well, healthcare is a basic human right and I will fight for basic human rights.”
Only New York Mayor Bill de Blasio backed her.
But Senator Amy Klobuchar said: “I am just simply concerned about kicking half of America off of their health insurance in four years.”
John Delaney also warned against such a policy.
Downed drone: Trump responds to Iran with more sanction than ‘disproportionate’ retaliation
U.S. President Donald Trump on Friday said he called off a planned military strike against Iran because it would have been a disproportionate response to Tehran’s downing of an unmanned U.S. surveillance drone, adding that more sanctions have been imposed.
“We were cocked & loaded to retaliate last night on 3 different sights (sic) when I asked, how many will die,” Trump wrote in a series of morning tweets. “150 people, sir, was the answer from a General.
“10 minutes before the strike I stopped it, not proportionate to shooting down an unmanned drone. I am in no hurry.”
Trump said U.S. sanctions imposed on Iran were having an effect and, without mentioning details, said more were added Thursday night.
Iranian officials told Reuters on Friday that Tehran had received a message from Trump warning that a U.S. attack on Iran was imminent but that he was against war and wanted to talk.
Trump’s tweets did not address whether he had sent a message to Iran’s leaders but repeated his attacks on the deal secured by his Democratic predecessor, Barack Obama. He also reiterated his stance that Iran would not be allowed to obtain nuclear weapons.
The escalating tensions come after Tehran on Thursday said it had shot down an unmanned U.S. military surveillance drone with a surface-to-air missile following a spate of attacks on oil tankers in the Gulf region.
Trump launches re-election bid
US President Donald Trump formally launched his 2020 re-election campaign on Tuesday in front of a large crowd in Orlando, Florida.
“We are going to keep making America great again and then we will indeed keep America great,” Trump said as he attacked his opponents and the media.
“We are going to keep it better than ever before and that is why I stand before you tonight to officially launch my campaign for a second term as president of the United States,” Trump told the crowd at an arena in Orlando.
The announcement comes amid calls for impeachment, continuing congressional probes into his presidency and administration and deepening divisions over his hardline immigration policies. But Trump’s speech also comes as the economy continues to grow and the Republican president maintains deep support among his base.
Although Tuesday’s speech is being billed as the official beginning of Trump’s 2020 bid, the businessman-turned-politician filed the paperwork officially announcing his bid within hours of his inauguration on January 20, 2017. He has since held campaign-style rallies throughout the United States.
On Tuesday, Trump’s attacks against socialism and his doubling down on conservative stances on nationalism, abortion, family, the judiciary and guns were positively received by the loyalist crowd, who often erupted in “USA” and “Make America Great” chants throughout the event.
Two-and-a-half years into his tenure, Trump sees plenty of positive factors, led by a growing economy with low unemployment.
“If the economy stays strong, he is very likely to get re-elected,” said Trump confidant Newt Gingrich, a former Republican speaker of the US House of Representatives.
Trump touted the economy throughout Tuesday’s speech, saying “it’s soaring to incredible new heights”.
The US president also received a large round of applause when he brought his tax cuts, saying, “we’ve done so much … with the biggest tax cut in history.”
But according to an Associated Press fact check, Trump’s tax cuts are nowhere close to the biggest in US history.
It’s a $1.5 trillion tax cut over 10 years. As a share of the total economy, a tax cut of that size ranks 12th, according to the Committee for a Responsible Federal Budget. Former President Ronald Reagan’s 1981 cut is the biggest, followed by the 1945 rollback of taxes that financed World War II.
Despite the packed crowd at the Orlando arena on Tuesday, Special Counsel Robert Mueller’s investigation of Russian interference in the 2016 election, coupled with a presidential style marked by name-calling and eye-popping tweets, has undermined some Americans’ confidence in Trump before the November 2020 election.
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