Bloomberg
(Bloomberg) -- Oil held losses near $65 a barrel in Asian trading after a recent rally ran out of steam amid a stronger U.S. dollar, which reduced the appeal of commodities priced in the currency.Futures in New York ended 1.6% lower on Monday after jumping to the highest level since October 2018 earlier in the session following an attack on a major Saudi Arabian export crude terminal. A Bloomberg survey is pointing to a third weekly gain in U.S. oil inventories, which may lead to the American benchmark falling further after figures are released on Wednesday.While the assault on Saudi Arabia’s Ras Tanura facility appears to have had no impact on crude exports, it’s the latest in a series of incidents following a number of attacks by Yemen’s Iran-backed Houthi rebels on the kingdom.Oil has rallied this year amid output cuts from Saudi Arabia and OPEC+ and an improving demand outlook with the rollout of Covid-19 vaccines. Prompt timespreads have firmed in a bullish backwardation structure, helping to unwind bloated inventories built up during the coronavirus pandemic, while investment banks continue to raise their crude price forecasts.“The price shock resulting from the attack on Saudi oil facilities proved to be transient,” said Howie Lee, an economist at Oversea-Chinese Banking Corp. “Oil at some stage needs a breather, but with OPEC+ and Saudi Arabia supporting the market, it’s unlikely the correction will be deep.”U.S. crude stockpiles increased by 3 million barrels last week, according to the median estimate in a Bloomberg survey. Inventories have expanded since mid-February after a cold blast shuttered many American refineries, although some plants have started to return to normal operations.For more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2021 Bloomberg L.P.
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