CCTV Script 06/05/15

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— This is the script of CNBC's news report for China's CCTV on May 6, Wednesday.

WTI and Brent crude, the international benchmark, rose as protests stopped oil flows to Libya's eastern port and Saudi Arabia raised the official selling price for Arab Light grade crude to the U.S. and Northwest Europe.

Brent was above $68 a barrel for the first time since December.

West Texas Intermediate oil futures for June rose above $60 per barrel Tuesday for the first time since December. That sparked expectations the price could go even higher, if U.S. oil inventory data Wednesday show an expected draw down in oil stored at the Nymex physical hub in Cushing, Oklahoma.

On Tuesday, Saudi Arabia oil minister Ali al-Naimi said he was not concerned by oil prices and that he was "not worried at all" about the prospect of Iranian crude coming back onto the market if sanctions on Iran are lifted as part of an international nuclear deal.

[Ali bin Ibrahim Al-Naimi | Oil Minister of Saudi Arabia] "I'm not worried about Iran crude, nor will I try to predict the prices. If I were to predict, I would be somewhere else gambling. Thank you."

Hadley: Sir I have one more question, in terms of speculators, OPEC said on Monday that speculators were much responsible for the price drop. What could you explain on that?

Speculators influence the short term changes in price. Long term, supply and demand, control the price.

Hadley: So are they at fault for the oil price?

Don't try to incriminate anybody.

But price gains should be capped by any increase in output so oil prices may not go much higher for now.

"Any increases in oil prices will bring more oil production, and it will dampen any price increases. Every time more production comes on, it is self-fulfilling. ... It will douse it and cool it off," said Fadel Gheit, senior energy analyst at Oppenheimer. "If oil prices stabilize above $60, I believe we are going to resume production growth in the second half of the year. More companies will drill more wells."

The U.S. industry, meanwhile, could be quick to gear up for a "fracking counterattack," said Andrew Lipow of Lipow Oil Associates. Lipow noted the forward futures show prices out in 2016 and 2017 to $65, $70 per barrel. "A lof of these frackers are thinking, 'Maybe I should hedge out in those years and start bringing rigs back on line at the end of 2015," he said.

The U.S. oil rig count fell to 679 as of last week, down from 1,527 at the same time last year. Besides shut-in wells, the industry could quickly get hundreds of of semicompleted wells up and running.

While some analysts do believe oil could see another low, crude futures have been firming since WTI futures hit a low of $42.03 barrels a day in March.

Wednesday's EIA data also could be market moving. Kilduff expects a draw down in Cushing but a build of 2.4 million barrels in U.S. oil supply.

CNBC's Qian Chen, reporting from Singapore.


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