Crude oil is stable in the early hours
After falling for four consecutive trading days, crude oil prices are stable in the early hours on September 2. At 6:30 AM EST on September 2, the West Texas Intermediate crude oil futures contract for October delivery was trading at $43.56 per barrel—a gain of ~0.93%. The Brent crude futures contract for November delivery was trading at $45.89 per barrel—a gain of ~0.95%.
Increasing hopes about output freeze talks
Prices are stable in the early hours on September 2 due to increased hopes about output freeze talks. On September 2, Adel al-Jubeir, Saudi Arabia’s foreign prime minister, said that he was expecting crude oil producers to take a common stance on oil production. Vladimir Putin, Russia’s president, commented that he supports output freeze talks. He said that it would allow Iran’s production to reach pre-sanction levels. These comments raised the expectations for output freeze talks and supported oil prices.
Crude oil has been falling since the beginning of this week amid an increase in crude oil inventory levels. At 10:30 AM EST on August 31, the U.S. Energy Information Administration reported that crude oil inventories rose by 2.3 MMbbls (million barrels) in the week ending on August 26. The market was expecting a surge in the inventories by 0.921 MMbbls. The worse-than-expected data caused prices to fall.
The market is also waiting for the oil rig count data by Baker Hughes. The data are scheduled to release on September 2. On September 1, major crude oil producers Carrizo Oil & Gas (CRZO) and British Petroleum (BP) fell 0.37% and 0.62%, respectively. Canadian Natural Resources (CNQ) and Total S.A. (TOT) gained 0.29% and 0.02%. The SPDR S&P Oil & Gas Exploration and Production ETF (XOP) and the PowerShares DB Oil ETF (DBO) fell 0.35% and 2.6%.