Oil prices ease on signs of steady output from some producers
Oil prices were about 1 percent lower on Monday as investors continued to await strong indications that an OPEC-led effort to drain a glut was proving effective but output increases in some top producers eased, keeping losses in check, APA reports quoting Reuters.
Libya's national oil production stood at 1.03 million barrels per day (bpd), little changed from its level since the end of last month, an oil industry official said.
U.S. drillers added two oil rigs in the week to July 14, bringing the total to 765, Baker Hughes (BHGE.N) said on Friday. RIG-OL-USA-BHI Rig additions over the past four weeks averaged five, the slowest pace of growth since November.
Still, U.S. shale oil production was forecast to rise for the eighth consecutive month, climbing 112,000 barrels per day (bpd) to 5.585 million bpd in August.
Key technical indicators are bullish, however, with prices rising above the short-term 50-day moving averages, traders said.
Brent crude LCOc1 fell 49 cents, or 1 percent, to settle at $48.42 a barrel. U.S. crude CLc1 ended the session 52 cents, or 1.1 percent lower at $46.02. Prices had earlier touched their highest since July 5.
"The idea of higher production levels, particularly in the U.S., Libya and Nigeria ... I think that seems to have been priced in for the moment," said Gene McGillian, manager of market research at Tradition Energy.
"I am skeptical. I think the market has bounced but it's having trouble finding traction to move higher probably because some the drop off in inventories are likely due to gasoline demand picking up."
A sharp drop in U.S. crude inventories in the week to July 7 supported prices last week. [EIA/S] But crude stocks in industrialized nations remained high, putting a brake on the oil price rally. [IEA/M]
"The market is not doing too much today - it feels like wait and see," said Olivier Jakob of oil analyst Petromatrix. "There is some rebalancing in products, but overall the layers of stocks are still very large."
U.S. gasoline margins RBc1-CLc1 rose to the highest since April 24 amid signs of improved demand and inventory declines, traders said.
Oil prices are less than half their mid-2014 level because of a persistent glut, even after the Organization of the Petroleum Exporting Countries with Russia and other non-OPEC producers cut supplies since January.
While OPEC-led cuts have offered prices some support, rising supplies from Nigeria along with Libya, two OPEC states exempt from the pact, and increasing U.S. production have weighed on the market.
Kuwait said on Friday the market was on a recovery track due to rising demand and said it was premature to cap Nigerian and Libyan output. An OPEC and non-OPEC committee meets in Russia on July 24 to discuss the impact of the deal.
In a sign of strong demand, data on Monday showed refineries in China increased crude throughput in June to the second highest on record. OPEC is hoping higher demand in the second half will drain excess inventories.
Related news releases
- 21.04.2018At least three dead, including police officer, in Nicaragua protests
- 21.04.2018Trump, France's Macron to discuss Iran nuclear deal next week
- 21.04.2018State Dept reveals content of US under secretary meeting with Russian ambassador
- 21.04.2018Russia calls for greater UN presence in Syria
- 20.04.2018US president slams cartel OPEC over high oil prices
- 20.04.2018Time reveals 100 Most Influential People for 2018
- 20.04.2018Man linked to 9/11 attacks on U.S. captured in Syria
- 20.04.2018No intent to change Syria's strategic balance: Pentagon
- 20.04.2018Trudeau says recognizes NAFTA timeline, will stick up for Canada
- 20.04.2018Russian diplomat calls on US to show readiness for constructive dialogue
- 20.04.2018US State Dept warns Turkey of possible sanctions over S-400 purchase
- 19.04.2018Steven Seagal has no plans to visit Armenia and Nagorno Karabakh
- 19.04.2018Trump: US taking care of Cuba following election of new president
- 19.04.2018Trump: Battle between US forces, Russian nationals in Syria month ago 'sad'
- 19.04.2018Trump, Japan's Abe agree to intensify trade talks
- 18.04.2018Castro nears retirement as Cuban president; successor proposed
- 18.04.2018Pompeo visits North Korea, forms 'good relationship with Kim', says Trump
- 18.04.2018Mike Pompeo, CIA chief, met with North Korean leader Kim Jong-un
- 18.04.2018US, allies to be unable to dislodge Assad
- 18.04.2018Former First Lady Barbara Bush dies at the age of 92
- 17.04.2018Top NAFTA officials to meet in Washington Thursday
- 17.04.2018US-led coalition ready to share data with Russia on İSİL in Syria’s Abu Kamal
- 17.04.2018Syria says missiles fired at air base intercepted; Pentagon denies involvement
- 17.04.2018Trump administration delays new sanctions on Russia: official
- 17.04.2018U.S., Britain blame Russia for global cyber attack
- 17.04.2018U.S. bans American companies from selling to Chinese phone maker ZTE
- 16.04.2018U.S. military chiefs to brief Congress on Syria behind closed doors
- 16.04.20187 inmates dead, 17 injured after hours of rioting at South Carolina prison
- 15.04.2018UN chief warns of full-blown military escalation over Syria attacks
- 15.04.2018Pence calls for more action to isolate Venezuela's Maduro
- 14.04.2018UNSC fails to adopt Russia-drafted resolution condemning Syria strike
- 14.04.2018NATO calls on Damascus allies to exercise responsibility after US-Led attack
- 14.04.2018U.S. strikes cripple Syria's chemical weapons ability: Pentagon
- 14.04.2018Pentagon says strikes "successfully hit every target" in Syria
- 14.04.2018Donald Trump: Mission accomplished
- 14.04.2018US says it didn’t give Russia any advance warning about targets hit in Syria strikes
- 14.04.2018US has proof Syrian regime behind gas attack: Nauert
- 14.04.2018U.S., Britain, France launch air strikes in Syria
- 14.04.2018Trump, Abe to focus on North Korea in Florida talks: U.S. official
- 14.04.2018Trump says U.S. will only rejoin Pacific trade pact if terms are improved
- 22.08.2017Trump: No timetable for Afghan troop withdrawal
- 22.08.2017US adds 4 Russian nationals in sanctions list
- 22.08.2017U.S., North Korea clash at U.N. forum over nuclear weapons
- 20.08.2017Second officer dies in Florida police shooting
- 20.08.2017Veteran NAFTA negotiators likely to deflect political pressures
- 20.08.2017Counterprotest derails 'free speech' rally in US city