Oil, gas markets close week mixed amid optimism on U.S. production

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March 30 (UPI) — After an up-and-then-down week, oil and gas markets closed slightly higher Thursday ahead of the Easter holiday weekend.

All major U.S. and European stock exchanges and markets were closed Friday for Good Friday, which coincides with the Passover holiday that starts Friday at sundown.

Growing U.S. inventories pulled prices lower Thursday after hitting $70 per barrel earlier this week, but they closed mixed by the end of the day.

The price for May Brent crude oil was up .56 cents to $64.94 per barrel. West Texas Intermediate, the U.S. benchmark for the price of oil, was unchanged to $69.53 per barrel. The May contract expired Thursday.

On Thursday, Baker Hughes reported the number of land rigs drilling for oil in the United States totaled 797, four less than in the previous week. But it is up 135 from a year ago. There are a total of 993 working rigs in the country, down by two in one week.

In North America, Baker reported there were 1,127 rigs compared with 1,156 a week earlier and 979 one year ago.

On Wednesday, the Railroad Commission of Texas, the state’s energy regulator, said it wanted to cut back on testing requirements for oil wells, which could save the industry $52 million a year.

Also Wednesday, the International Energy Agency said the United States, buoyed by steel tariffs on other countries, is on pace to become the largest oil producer in the world, possibly passing Russia at some point in the very near future. The IEA said production from the Eagle Ford and Permian basins in Texas will increase by as much as 2.7 million barrels per day in the next five years.

Olivier Lejeune, an oil analyst at the IEA, however, said infrastructure capacity will constrain the sector in the southern U.S. shale belt.

The Federal Reserve Bank of Dallas, in a survey of 140 oil and gas companies released Wednesday, found uneven enthusiasm about U.S. policies, but revealed general optimism. On the new tax policy to extend permanent breaks to corporations, 46 percent of the executives expected a “slightly positive impact,” while 5 percent expected a negative effect. Most of the oil and gas support firms expected a significant impact, while 36 percent of the total expected no impact at all.

The U.S. Association of Oil Pipe Lines cautioned new tariffs imposed by President Donald Trump the cost of major pipeline projects, like Keystone XL, would rise and remove jobs out of the U.S. economy.

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