US commercial crude stocks fell by 2.22 million barrels to 524.35 million barrels, according to the Energy Information Administration (EIA).
Advertisement
Brent crude was down US$1, or 2.1 per cent, at US$47.47 a barrel by 9:48 am EDT (1348 GMT).
Although loadings reportedly resumed overnight, Iraq plans to cut crude oil exports from its southern ports to 2.79 million barrels per day (bpd) in August from 2.99 million bpd planned for July, a preliminary loading program showed.
“When U.S. shale production was moving upwards very fast it became fashionable to talk of lower reliance on traditional suppliers”, the IEA said in its report underscoring that the high Middle Eastern numbers should be an “eloquent reminder that even when U.S. shale production does resume its growth, older producers will remain essential for oil markets”.
“Therefore any weakness based on the IEA report should be short-lived”, said Tamas Varga, oil analyst at London brokerage PVM Oil Associates. The distillate crack spread 0#CL-HO=R , a measure of the profit from refining crude into distillates, touched a one-month low. Together, the group pumped 32.86 million barrels a day in June, 264,1000 barrels a day higher than a month earlier, primarily on higher production from Nigeria, Iran and Saudi Arabia. The bank forecast USA crude would average $43.59 per barrel this year versus $36.91 in its earlier forecast, and $55.00 for 2017, versus $52.88 earlier.
Global oil demand, meanwhile, is expected to increase, OPEC said, and “thus, market conditions will help remove overall excess oil stocks in 2017”.
This is while in its Short-term Energy Outlook June 2016, the EIA forecast the WTI at $42.83 per barrel and $51.82 per barrel in 2016 and 2017, respectively.
International Brent crude oil futures were trading at $46.13 per barrel at 8.27 p.m. ET, down 12 cents from their last close and near to the $45.90 two-month lows reached the previous day.
In its monthly oil market report, Opec trimmed its forecast for world growth in 2016 to 3% from 3.1% and said the global economy would also be “impacted by the dampening effect of the United Kingdom vote”. USA benchmark West Texas Intermediate was at $45.40.
Crude oil refinery inputs averaged 143,000 barrels less per day than the prior week’s average, bringing the average inputs to 16.5 million barrels per day.
Advertisement
Futures lost as much as 1.6% in NY. China and India are seen expanding this year at 6.5 percent and 7.5 percent, respectively, and growth is forecast to slow slightly to 6.1 percent and 7.2 percent in 2017.
