OPEC chief says producers seek market stability


OPEC chief says producers seek market stability

U.S. West Texas Intermediate crude futures were also down 18 cents at $53.

"It seems that the optimism in the oil market we have seen since the last few days of March is running out of steam", wrote Tamas Varga, PVM Oil Associates analyst, noting the "ever-increasing rise" in USA shale output.

OPEC members Saudi Arabia and Kuwait signaled that the Organization of the Petroleum Exporting Countries and other producers, including Russian Federation, would likely extend their oil output cut beyond June. Crude inventories fell 1.03 million barrels to 532.3 million, the agency reported Wednesday.

Brent crude futures LCOc1 traded at $54.92 per barrel, while the US West Texas Intermediate (WTI) crude futures CLc1 also remained nearly unchanged from the last close at $52.43 a barrel, reported Reuters.

Saudi Arabia's oil export in February 2017 has decreased to the lowest level since May 2015, according to the data of the Joint Organizations Data Initiative (JODI).

Traders said that the rising USA crude production posed a concern that the oil supply overhang would continue, while the jump in gasoline stocks implied a stutter in demand.

USA output, almost 55% of which comes from its seven major shale plays, averaged 9.25 million b/d in the week ended April 14, up almost half a million barrels a day versus the end of 2016, and around 820,000 b/d higher than the recent trough of July 2016, according to the latest EIA data.

Looking ahead for oil, "the next big market mover looks to be when OPEC meets regarding an extension in production cuts on May 25", said Macaluso.

The energy minister of OPEC member the United Arab Emirates predicted healthy oil demand growth this year and said inventories would fall, but it would take time.

The analysts even suggest that the OPEC deal could offset any gains in US shale output over the next 6 to 9 months. USA production rose to 9.252 million barrels a day in the most recent week, the highest since August 2015. Due to the long period of low energy prices, the authorities of the oil states are trying to find other sources of income.

The United States is working with allies and China on responses to the failed test, U.S. President Donald Trump's national security adviser said on Sunday.

Many U.S. sanctions against Iran were lifted in late 2015, allowing Tehran to boost its crude oil exports from 2016 which added to the global glut.