Azernews.Az

By Bloomberg

Oil rose for the second time in three days after the U.S. economy expanded at the fastest pace in more than a decade in the third quarter.

West Texas Intermediate climbed as much as 2.9 percent in New York, paring this year’s decline to 43 percent while Brent gained as much as 2.3 percent in London. The U.S. economy expanded at a 5 percent annual rate from July to September, according to the Commerce Department. Stockpiles in the U.S., the world’s largest oil consumer, probably dropped for a second week, a separate Bloomberg survey showed before weekly government data tomorrow.

“The jump in personal consumption and investment point to a U.S. economy starting to gain traction and to be self- supporting, which should translate into positive momentum in 2015,” Michael Hewson, London-based chief market analyst at CMC Markets Plc, said by e-mail.

WTI for February delivery increased as much as $1.59 to $56.85 a barrel in electronic trading on the New York Mercantile Exchange and was at $56.41 at 1:44 p.m. London time. The volume of all futures traded was about 10 percent below the 100-day average for the time of day.

Brent for February settlement gained as much as $1.38, or 2.3 percent, to $61.49 a barrel on the London-based ICE Futures Europe exchange. The European benchmark crude traded at a premium of $4.70 to WTI.

Annual Loss

Crude is set for the biggest annual loss since 2008 amid the highest U.S. output in more than three decades. Saudi Arabia, OPEC’s biggest producer, doesn’t plan to pump less “whatever the price is,” Oil Minister Ali Al-Naimi told the Middle East Economic Survey yesterday.

U.S. economic growth last quarter marked the biggest advance since the third quarter of 2003, and compared with a previously estimated 3.9 percent, revised figures from the Commerce Department showed today in Washington. The median forecast of 75 economists surveyed by Bloomberg projected a 4.3 percent increase.

OPEC’s decision on Nov. 27 to maintain its output ceiling was “part of its effort to defend its market share,” Iraqi Oil Minister Adel Abdul Mahdi said in an interview yesterday. Production cuts to support prices in 2008 didn’t prevent a decline in its market share, he said. WTI dropped a record 54 percent that year.

Defensive Strategy

OPEC pumped 30.56 million barrels a day in November, exceeding its collective target of 30 million for a sixth straight month, a separate Bloomberg survey of companies, producers and analysts shows.

Saudi Arabia doesn’t intend to cut output, Al-Naimi said in the interview with MEES. “Whether it goes down to $20, $40, $50, $60, it is irrelevant,” he was cited as saying. The nation pumped 9.65 million barrels a day last month.

“It paints a very pessimistic picture for oil prices, and what it means for non-OPEC supply,” Gareth Lewis-Davies, an analyst at BNP Paribas SA in London, said by phone, referring to Al-Naimi’s comments.

Iraq plans to boost production to 4 million barrels a day next year as the Organization of Petroleum Exporting Countries refuses to cede market position, Abdul Mahdi said in the interview.

In the U.S., crude inventories probably shrank by 2.5 million barrels to 377.4 million last week, according to the median estimate in a Bloomberg survey of seven analysts before the Energy Information Administration’s report. Production expanded to 9.14 million barrels a day through Dec. 12, the highest level in weekly data that started in January 1983.