Oil prices rise on slower United States output growth, strong Chinese demand

18 July, 2017, 06:10 | Author: Oscar Goodwin
  • Oil prices rise on slower United States output growth, strong Chinese demand

That's because supplies from within OPEC remain high largely due to rising output from Nigeria and Libya, two OPEC states exempt from the pact, and increasing US production. New rigs over the past four weeks averaged five, the lowest since November 2016.

He said representatives from Libya and Nigeria had been invited to a technical OPEC/non-OPEC committee meeting on July 22 ahead of the ministerial gathering, to give presentations on production from both countries.

Disruption to Nigerian oil exports is offset by production gains from Libya, which is on pace to add another 100,000 barrels per day to the market, a market report found. Indian crude imports in June were also higher at 4.38 mbpd, up 3.7 per cent YoY.

Key technical indicators are bullish, however, with prices rising above the short-term 50-day moving averages, traders said.

Brent crude futures, the worldwide benchmark for oil prices, were at $48.55 per barrel at 0130 GMT, up 13 cents, or 0.3 percent, from their last close. Indeed, the OPEC has warned of a likely surplus of production in 2018 although being at a high level already.

A third reason oil prices are starting to edge up towards $50 is that the USA has posted two consecutive weeks of strong inventory declines.

Analysts say the concerns about oversupply have not gone away, so there are questions about how much more room oil has to run from the producers.

West Texas Intermediate oil prices are depressed relative to Middle East benchmark Dubai because of rising US shale oil production and as the OPEC cuts have reduced the amount of Middle East medium, sour crude.

"There is some rebalancing in products, but overall the layers of stocks are still very large".

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 Russian Federation and other non-Opec producers cut supplies since January. An Opec and non-Opec committee meets in Russian Federation on July 24 to discuss the impact of the deal.

There had been fears that OPEC's supply-cutting pact would be undermined by the surge of growth in shale production in the United States, but demand still appears to be strong with China's crude throughput for June, reaching the second-highest amount on record.

Kuwait's OPEC governor said that OECD crude oil inventories would fall in 2H17 due to a rise in global crude oil demand and OPEC's high compliance to the production cut deal.

Recommended:

  • Tsunami alert as powerful quake hits off Russia's Kamchatka

    Tsunami alert as powerful quake hits off Russia's Kamchatka

    Note that with a magnitude 9.0 quake , the probability of an aftershock with a magnitude exceeding 7.5 is not negligible. To date, the largest aftershock recorded has been magnitude 7.1 that did not produce a damaging tsunami.
    Trump continues attack on media over Russian case

    Trump continues attack on media over Russian case

    Trump said the same during a gaggle with reporters on Air Force One as he flew to Paris last week. Trump Jr. responded in part, "if it's what you say I love it especially later in the summer".
    United Nations  condemns jump in Afghan civilian deaths

    United Nations condemns jump in Afghan civilian deaths

    But Afghans also suffer at the hands of government and allied forces, sometimes as they come across their unexploded ordnance. Yamamoto called on antigovernment forces to immediately stop the use of IEDs.
  • LeT 'terrorist' deported from UAE arrested in Mumbai

    LeT 'terrorist' deported from UAE arrested in Mumbai

    Personnel from Anti-Terrorism Squads of Maharashtra and Uttar Pradesh were at the airport when Salim landed, the official said. Khan has been on the run ever since and had managed to hoodwink security agencies.
    Emirates and flydubai Go Beyond Codeshare

    Emirates and flydubai Go Beyond Codeshare

    Emirates cited fierce competition and a "relentless rise" in the USA dollar as the main factor in falling revenues. FlyDubai also saw its profit drop 69% in 2016 and cited a "challenging socioeconomic environment".

    Trump's approval rating plunges to 70-year low

    While President Donald Trump's approval rating continues to lag, many of his supporters in the Republican base remain by his side. Gallup has been conducting the approval rating poll of all US President's presidencies since Harry S Truman .
  • China Welcomes South Korea's Push for Talks With North Amid Nuclear Crisis

    China Welcomes South Korea's Push for Talks With North Amid Nuclear Crisis

    When asked whether Seoul consulted with Washington, Cho replied that the countries "mutually cooperated" on the matter. He proposed that the talks be held on 21 July, and said: "We expect a positive response from the North".
    RuneScape Will Release on Mobile With Cross-Play Support With PC

    RuneScape Will Release on Mobile With Cross-Play Support With PC

    According to Jagex , the mobile version of RuneScape will be the same game "you know and love", optimized for phones and tablets. RuneScape might be old enough to drive, but it still has an active community, with thousands of players streaming on Twitch .
    This Could Be The iPhone 8 Final Design

    This Could Be The iPhone 8 Final Design

    Kind of like the iPhone 4 , but bigger, a lot less chunky and no more Home button taking up space on the front. However, according to Huberty, the possibility of iPhone 8 delays won't decrease the demand for the new phone.
  • CBO delays scoring of GOP health care bill in yet another setback

    CBO delays scoring of GOP health care bill in yet another setback

    Chris Karpowitz, co-director of BYU's Center for the Study of Elections and Democracy, said Lee is in a tough position. The Senate Budget Office said the report would be postponed, but it did not give an explanation for the delay.

    Ed Sheeran makes his "Game of Thrones" debut

    We haven't seen Arya's direwolf since way back in Season 1 Episode 2, when Arya sent her away after biting Joffrey. In particular, Arya received a lot of positive attention thanks to her scene-stealing vengeance in the cold open.
    Cowboys wide receiver claims his dog is being held for ransom

    Cowboys wide receiver claims his dog is being held for ransom

    Lucky Whitehead really loves his dog , Blitz, which makes the situation he's going through significantly sadder. He said the caller said he would call back "but I haven't heard from him since".


Popular

Federer, Muguruza attend Wimbledon Champions Ball
Federer's latest victory pushed up to No.3 behind Andy Murray and Nadal. I've played nearly every player here that wouldn't serve and volley.

Capitol Police say individual drove into barrier, car
The chase ended when the vehicle slammed into a barrier and a police auto near the Library of Congress , according to reports. Cops used a bomb robot to apporach the vehicle and officers were heard yelling "fire in the hole" before the explosion.

Korea offers talks on tension, family reunions with North
Cui Tiankai, China's ambassador to Washington, said on Monday secondary sanctions were "not acceptable". The administration did not get Congressional approval before airstrikes on Syria in April.

UAE wants global monitoring of Qatar
Inciting violence, encouraging radicalisation, and undermining the stability of its neighbours", Yousef Al Otaiba wrote in a statement posted on Twitter.

Hurriyet: Turkey extends state of emergency by further three months
Turkish President Recep Tayyip Erdogan arrives in Istanbul to commemorate the 1-year anniversary of the July 15, 2016 coup attempt.