WTI Oil Drops From One-Week High as Saudi Arabia Boosts Output

West Texas Intermediate oil dropped from the highest price in more than a week as Saudi Arabia boosted output and industrial production slowed in China, the world’s second-biggest consumer of crude.

Futures slid as much as 0.4 percent after gaining 1.4 percent last week, the most in a month. Saudi Arabia’s crude production rose in February from a 20-month low, an official with knowledge of the country’s oil policy said. China started the year with the weakest industrial output since 2009, government data showed March 9. Iran, which is under Western sanctions on its energy exports because of its nuclear program, said the prospects for resolving the dispute have improved.

“The higher Saudi production serves as a cap on oil prices and could drive down WTI,” said Gordon Kwan, the head of energy research at Mirae Asset Securities Ltd. in Hong Kong.

WTI for April delivery fell as much as 35 cents to $91.60 a barrel in electronic trading on the New York Mercantile Exchange and was at $91.74 at 2:02 p.m. Singapore time. The contract rose 39 cents to $91.95 on March 8, the highest close since Feb. 28. Prices are down 0.3 percent this month.

Brent for April settlement declined 38 cents to $110.47 a barrel on the London-based ICE Futures Europe exchange. The European benchmark was at a premium of $18.74 to WTI futures. The gap ended the session at $18.90 on March 8, the narrowest difference since Jan. 31. The volume of all futures traded today was 52 percent below the 100-day average for WTI, and 40 percent lower for Brent.

(Source: Bloomberg)