RBC Oil Market Will Tighten Amid Significant Loss Of Iran Crude

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The EIA now estimates that the June production would be 10.900 million bpd, but the revision to the May figure suggests that the output for June could be lower than the expected 10.9 million bpd, according to Bloomberg.

US crude was off by 5 cents at $68.91, after gaining almost 2 percent in the previous session.

A higher crude output from the Saudis, along with Nigeria and Iraq, pushed up total production from the Organisation of Petroleum Exporting Countries by 300,000bpd, offsetting losses from a spiraling economic collapse in Venezuela, political clashes in Libya and the onset of United States sanctions against Iran.

Crude fell to the lowest in more than five weeks as a surprise rise in US crude inventories and increases in production from OPEC and Russian Federation has investors anxious that global supply levels are on the upswing.

Saudi Aramco cut its September price for its Arab Light grade for Asian customers by $0.70 a barrel versus August to a premium of $1.20 a barrel to the Oman/Dubai average, it said on Thursday.

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Oil prices strengthened Thursday, with US crude gaining almost 2 percent after traders saw an industry report suggesting domestic crude stockpiles would soon decline again after a surprise rise in the latest week.

The nation's production may remain around the 11.2 million barrels a day level for the remainder of the year, the government official said, citing the oil ministry's most recent calculations.

U.S. West Texas Intermediate (WTI) crude futures CLc1 were down 27 cents at $68.69 a barrel by 10:45 a.m. EDT (1445 GMT).

Traders said prices rallied early when industry information provider Genscape reported that crude inventories at the Cushing, Oklahoma, delivery hub for USA crude, dropped 1.1 million barrels since Friday, July 27.

Escalating trade war could result in a notable drop in demand for crude oil.

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Worries about the possible loss of Iranian supply are being somewhat offset by concerns that global trade tensions could slow economic growth and crimp energy demand.

Trump has turned up pressure on China for trade concessions by proposing a higher 25% tariff on $200 billion of Chinese imports and China has said it will retaliate.

Novak said that higher production was needed to maintain the market's stability.

While the Saudis and their Gulf allies said they would increase production to make up for countries unable to, Iran argues that they're violating individual country targets and ultimately betraying the organisation.

On Monday, a Reuters survey found that Opec production reached a 2018 high in July.

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