Oil slides as output rises at Libya's largest oil field
Oil prices fell as much as 2 percent on Monday on selling triggered by a rebound in production from Libya's largest oil field along with worries about higher output from OPEC and the United States, APA reports quoting Reuters.
Output at Libya's Sharara field was returning to normal after a brief disruption by armed protesters in the coastal city of Zawiya, the National Oil Corporation (NOC) said. The field has boosted Libya's oil production, which climbed to more than 1 million bpd in late June.
Global benchmark Brent crude futures LCOc1 were down 73 cents, or 1.39 percent, at $51.69 a barrel at 12:13 a.m. EDT (1613 GMT) after trading as low as $51.37 a barrel
U.S. crude futures CLc1 were down 80 cents, or 1.6 percent, at $48.78 per barrel, after sinking to a low of $48.54 a barrel.
Both contracts stood well below levels hit last week, which marked their highest since late May.
Doubts have emerged about the effectiveness of output cuts by the Organization of the Petroleum Exporting Countries and other big producers including Russia. OPEC output hit a 2017 high in July and its exports hit a record.
"The petroleum markets are tipping toward the lower end of their recent trading range as oil producers meeting in Abu Dhabi have been slow to assure the market that compliance with this year’s production cuts will be improved, although we continue to note that adherence to the limits has actually been quite strong by historical standards," Tim Evans, Citi Futures' energy futures specialist, said in a note.
"The recent increase in OPEC production has mostly been a function of recovering volumes from Libya and Nigeria."
Officials from a joint OPEC and non-OPEC technical committee are meeting in Abu Dhabi on Monday and Tuesday to discuss ways to boost compliance with the deal to cut 1.8 million barrels per day in production.
Oil output in the United States remained high even though Baker Hughes data on Friday showed a cut of one drilling rig in the week to Aug. 4, bringing the U.S. rig count down to 765. RIG-OL-USA-BHI
U.S. weekly oil production hit 9.43 million bpd in the week to July 28, the highest since August 2015 and up 12 percent from its most recent low in June last year. C-OUT-T-EIA
Some analysts expected OPEC could talk up prices.
"Saudi Arabia will restate that they will export only 6.6 million bpd (six-year low) in August and inventories will continue to draw down," SEB Markets chief commodities analyst Bjarne Schieldrop said.
On the demand side, Goldman Sachs said data available so far for June points to continued strong growth.
"We believe that the biggest driver for this robust demand is strong economic growth in recent months," Goldman said in a note.
Related news releases
- 25.02.2018U.N. Security Council demands truce as air strikes batter Syria's Ghouta
- 24.02.2018Trump tax cut fuels record profit for Buffett's Berkshire
- 24.02.2018Trump urges Mexico to block illegal immigrants from El Salvador
- 24.02.2018UNSC postpones vote on ceasefire proposal in Syria
- 24.02.2018NASA finds water could be widespread on moon
- 24.02.2018White House on lockdown after vehicle hits security barrier
- 24.02.2018Trump: If North Korea sanctions don't work, we go to 'Phase 2'
- 24.02.2018Trump campaign aide to plead guilty
- 24.02.2018U.S. ready to open Jerusalem embassy in May: State Department
- 23.02.2018U.S. expects to open Jerusalem embassy in May, officials say
- 23.02.2018U.S. imposes largest package of sanctions against North Korea
- 23.02.2018Trump administration to target North Korea with new sanctions on Friday
- 23.02.2018IAEA reaffirms Iran’s compliance with JCPOA in its new report
- 23.02.2018SpaceX launches internet satellite prototypes
- 23.02.2018Man dies after throwing explosive device at US Embassy in Montenegro
- 23.02.2018Oil prices climb after unexpected drawdown in U.S. crude stocks
- 23.02.2018Russian diplomats tried to export 400 kg of cocaine from Argentina
- 22.02.2018Charity boss resigns from Unicef
- 22.02.2018US: Melania Trump’s parents become US residents
- 22.02.2018U.S. SEC updates guidance on cyber attack disclosure for companies
- 21.02.2018US: students rally in Florida to stop school shootings
- 21.02.2018U.S.-led air strike in Somalia kills three al Shabaab militants: statement
- 21.02.2018US pledges closer cooperation with Turkey
- 21.02.2018Trump pushes for ban on gun 'bump stocks'
- 21.02.2018Trump phones Mexican president over copter crash
- 20.02.2018Pentagon prepares new ballistic missile defense review
- 19.02.2018Tillerson says new sanctions can be imposed on Russia
- 18.02.2018US to work with Turkey on liberated areas in Syria
- 18.02.2018Brazil to form public security ministry to battle rising crime
- 18.02.2018US charges 13 Russian nationals, 3 organizations with alleged meddling in 2016 election
- 17.02.2018Mexico helicopter crash kills 13 on ground in wake of earthquake
- 17.02.2018Helicopter with interior minister, governor crashes into van in Mexico, kills two
- 17.02.2018Flu killed 22 American children last week
- 17.02.2018Mexico hit by major earthquake of magnitude 7.5
- 17.02.2018FBI failed to investigate Florida shooter tip
- 16.02.2018US grand jury indicts 13 Russians for election meddling
- 16.02.2018John Kirby: "Tillerson breaks protocol by meeting Erdogan without translator"
- 16.02.2018Tillerson and Turkey's Erdogan had productive conversation: U.S. spokesman
- 16.02.2018US court says travel ban discriminates against Muslims
- 15.02.2018FBI was warned about Florida gunman
- 07.08.2017U.S. can talk to North Korea if it stops missile tests: Tillerson
- 08.08.2017Trump: North Korean threats 'will be met with fire & fury'
- 09.08.2017Venezuela using excessive force, arrests to crush protests: U.N.
- 06.08.2017Trump: "UNSC sanctions to make big financial impact on N. Korea"
- 06.08.2017Washington to continue taking 'Prudent Defensive Measures' against Pyongyang
- 06.08.2017U.S. searching for 3 missing Marines after aircraft mishap off Australia