(MENAFN- The Peninsula) The Peninsula
Oil prices slid for a second day in a row on Friday, pressured by an unexpected rise in US crude and fuel inventories while investors took profits after the benchmarks touched seven-year highs earlier last week. Brent futures fell 49 cents, or 0.6 percent, to settle at $87.89 a barrel, while US West Texas Intermediate crude fell 41 cents, or 0.5 percent, to settle at $85.14. However, both crude benchmarks rose for a fifth week in a row, gaining around 2 percent last week. Prices were up more than 10 percent so far this year on concerns over tightening supplies. The latest pullback is most likely due to a combination of pre-weekend profit-taking and the absence of fresh bullish catalysts, according to analysts.
Other analysts also said they expect the current pressure on prices to be limited owing to supply concerns and rising demand. Tensions in Eastern Europe and the Middle East are also heightening fears of supply disruption. Meanwhile, the EIA reported the first US stock build since November and 11-month highs for gasoline inventories. Crude inventories rose by 515,000 barrels in the week to January 14 to 413.8 million barrels, while gasoline stocks rose by 5.9 million barrels to 246.6 million barrels.
Asian spot LNG prices dropped last week as large Chinese sell tenders signalled that supplies are well-stocked amid continued tepid Asian demand. The average LNG price for March delivery into north-east Asia fell to around $23.00 per metric million British thermal units, down $9.60 or nearly 30 percent from the previous week. China's Sinopec Corp has issued a tender to sell up to 45 cargoes of liquefied natural gas for 2022 deliveries, in a rare sell tender to take advantage of high Asian spot prices.
Meanwhile, Europe continues to receive a high amount of LNG tankers, with the first-ever LNG shipment from Indonesia arriving in Greece late last week. The arrival of several LNG gas tankers into Europe has helped to ease prices but concerns over Russia-Ukraine tensions remain. In the United States, natural gas futures climbed over 5 percent on Friday on what is expected to be the country's biggest gas demand day on record with forecasts for more cold weather and higher-than-expected heating demand over the next two weeks. In addition to boosting gas demand, the cold last week cut gas output to its lowest in four months as wells and other equipment froze in Texas, Pennsylvania and elsewhere.
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