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Crude oil futures weaken as US production climbs further, dollar rises

Washington (Platts)--8 Mar 2018 1134 am EST/1634 GMT


Oil futures were lower Thursday morning as rising US production and a stronger dollar pulled NYMEX crude toward $60/b.

At 1621 GMT, NYMEX April crude was 54 cents lower at $60.61/b. ICE May Brent was down 28 cents at $64.06/b.

US production increased 86,000 b/d last week to 10.369 million b/d, a record high, according to US Energy Information Administration weekly estimates that go back to 1983.

The EIA forecasts US production will average 10.7 million b/d in 2018 and 11.3 million b/d in 2019, up from 9.3 million b/d in 2017.

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A weaker euro was helping boost the US Dollar Index, which was up 0.41 at 90.05 Thursday morning.

The euro was volatile Thursday, initially spiking after the European Central Bank's latest meeting concluded before turning lower.

The ECB held interest rates steady Thursday, as expected, but dropped key language saying the ECB was prepared to increase bond purchases if necessary.

That tweak suggests ECB officials have grown more comfortable with the pace of economic growth in the eurozone.

"With the broadest economic expansion since before the crisis and the risks of deflation successfully arrested, there is little chance conditions would quickly deteriorate that would require more aggressive easing," BBH analysts said in a note.

Attention will turn Friday to US jobs data when the Department of Labor releases its report covering February.

Refined product futures were also lower Thursday. NYMEX April ULSD was 38 points lower at $1.8708/gal. NYMEX April RBOB was down 2.46 cents at $1.8859/gal.

--Geoffrey Craig, geoffrey.craig@spglobal.com




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