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Oil prices slump over 1 pct on rise in U.S. output

Published 07/07/2017, 11:38 am
Updated 07/07/2017, 11:40 am
© Reuters.  Oil prices slump over 1 pct on rise in U.S. output
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* Rising U.S. production outweighs falling inventories

* Increased U.S. production comes as OPEC supplies also rise

* OPEC's exports rose in June despite its pledge to cut

By Henning Gloystein

SINGAPORE, July 7 (Reuters) - Oil prices fell by more than 1 percent early on Friday, with U.S. crude futures dipping below $45 per barrel as news of a rise in U.S. production added to earlier reports that OPEC output was also on the rise.

Brent crude futures LCOc1 , the international benchmark for oil prices, were trading down 58 cents, or 1.2 percent, at $47.53 per barrel by 0137 GMT.

U.S. West Texas Intermediate (WTI) crude futures CLc1 were at $44.95 per barrel, down 57 cents, or 1.3 percent.

News of the production rise outweighed positive sentiment from falling crude and gasoline inventories in the United States.

"Oil prices were initially stronger of the back of the better than expected drawdown in inventories... However, the exuberance was short-lived, as the market turned its attention to another increase in U.S. production," ANZ bank said on Friday.

U.S. crude inventories USOILC=ECI fell by 6.3 million barrels in the week to June 30, to 502.9 million barrels, according to the U.S. Energy Information Administration (EIA). Gasoline stocks USOILG=ECI fell by 3.7 million barrels, to 237.3 million barrels. data suggested strong demand in the United States, but this was offset by a 1 percent rise in weekly U.S. oil production C-OUT-T-EIA to 9.34 million barrels per day (bpd). Since mid-2016, that's an increase of more than 10 percent.

The rising U.S. output comes as supplies from the Organization of the Petroleum Exporting Countries (OPEC) rose for a second month in a row in June, according to Thomson Reuters Oil Research, despite its pledge to hold back production between January this year and March 2018.

OPEC exported 25.92 million barrels per day (bpd) in June, 450,000 bpd more than in May and 1.9 million bpd more than a year earlier. GRAPHIC: OPEC crude oil exports

http://reut.rs/2sKHJct

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