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16 August 2017, 03:23 | Lorenzo Hawkins
Libyan oil production down by 30%
- Market participants keenly awaited the latest weekly data from the Energy Information Administration on US stocks and production, due later on Wednesday. "If not, prices are likely to drop below $51 and test $50 again".
Analysts polled by Reuters forecast that data would show USA crude stockpiles fell for a seventh consecutive week, along with a probable drop in distillate and gasoline inventories.
Brent and US crude reached two-month highs in early August but have slid over the last few days, dropping more than 2.5 percent on Monday.
USA crude inventories fell by 9.2-million barrels in the week to August 11 to 469.2-million, industry group the American Petroleum Institute said on Tuesday.
A total of 1.9 million barrels of both U.S. crude grades will be shipped by the end of October.
US West Texas Intermediate (WTI) crude futures were at $47.71 a barrel, up 16 cents, or 0.3 per cent. While that narrowed the surplus, stockpiles were still 219 million barrels above the five-year average at the end of June, the agency said.
More broadly, analysts said ample supplies were preventing prices from moving much higher. Worse still, this momentum is not expected to change into the first quarter of 2018 when the current OPEC deal where oil output will be cut by 1.8m bpd will have run out.
Crude production at Libya's biggest oil field has plunged more than 30 per cent in recent days after two company vehicles were stolen at gunpoint, raising new security concerns at the Opec country's operations, a person familiar with the matter said.
The International Energy Association (IEA), a Paris-based energy think tank based in Paris in its oil market report released last Friday said that global demand is expected to reach 1.5m bpd this year, up from 1.4 m forecast last month. The American Petroleum Institute is out with industry report this afternoon.
"OPEC and Russian Federation still face an uphill battle in reducing the global supply surplus in the face of growth in output elsewhere and less than compliant behavior in their midst (Iraq, UAE)", said French bank BNP Paribas. Crude supplies at Cushing, Okla., the delivery point for WTI and the biggest USA oil-storage hub, rose 700,000 bbl last week, according to a Bloomberg-compiled forecast.
On the demand side, analysts see a gradual slowdown in fuel consumption growth.
Gaza Rocket Explodes in Southern Israel
Israel says attacks carried out after rockets were fired out of Gaza, a claim that Hamas denies . Two people were seriously wounded and another sustained light injuries, local media reported .
Bank of England cuts its growth forecasts for the UK
Policymakers agreed however to increase cheap lending for retail banks before the expiry of the Term Funding Scheme next February. It blamed the downgrade on Britain's stubbornly weak productivity and in part on the Brexit uncertainty.