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UPDATE 7-Oil prices rise on forecasts for growing demand, OPEC concerns

Published 06/03/2018, 07:40 am
© Reuters.  UPDATE 7-Oil prices rise on forecasts for growing demand, OPEC concerns
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* OPEC to meet with U.S. shale firms in Houston

* No talks yet on extending output cuts into 2019 - UAE min

* Venezuela oil production 1.5 mln bpd short of historicoutput

* IEA predicts robust oil demand in next 5 years

* U.S. to take oil market share from OPEC - IEA (Adds closing prices)

By Scott DiSavino

NEW YORK, March 5 (Reuters) - Crude prices rose on Mondayalong with the U.S. stock market on forecasts for robust oildemand growth and concerns that output from OPEC producers wouldgrow at a much slower pace in coming years.

Brent futures LCOc1 gained $1.17, or 1.8 percent, tosettle at $65.54 a barrel, while U.S. West Texas Intermediatecrude futures CLc1 gained $1.32, or 2.2 percent, to settle at$62.57.

Oil prices, which were flat earlier in the day, startedrising along with U.S. stocks. The S&P 500 Index .SPX was upover 1 percent shortly before the close of trading.

"Today's spike in the equities was a large driver behindtoday's (oil) price recovery," Jim Ritterbusch, president ofChicago-based energy advisory firm Ritterbusch & Associates,said in a report.

Analysts also said prices were propped up by "bullishcomments" from ministers from the Organization of the PetroleumExporting Countries and other global industry players at theCERAWeek conference in Houston, the largest energy conference,on Monday. Kumar, senior energy analyst at Interfax Energy'sGlobal Gas Analytics in London, said comments about "Venezuela'sdeteriorating oil-production profile, together with prospectsfor strong compliance with the OPEC-led output-cut agreement,(were) supportive of oil prices."

Ecuador's oil minister Carlos Perez said Venezuela's oilproduction was running 1.5 million barrels per day (bpd) shortof its historic output. Speaking on the sidelines of theCERAWeek conference, he noted it was something that the countrymust address itself. Secretary General Mohammad Barkindo and other OPECofficials are expected to hold a dinner on Monday with U.S.shale firms on the sidelines of the conference. Mohamed Al Mazrouei, the United Arab Emirates oilminister and OPEC's current president, said on Sunday that the cartel had not discussed rolling over production cuts next year. feel there is still market overhang," Al Mazrouei said,adding "there are no talks about (extending cuts into 2019) atthis stage."

OPEC and other major producers agreed to cut combined outputby about 1.8 million bpd to drain a global oil glut. Theagreement began in January 2017 and runs through the end of thisyear.

Also on Monday, the International Energy Agency, whichadvises industrialized nations on energy policies, said itexpected annual global oil demand growth to average a fairlyrobust 1.1 percent to 2023 and noted that OPEC would fail tosignificantly increase its production capacity. meet growing demand, IEA said U.S. shale oil output wasset to surge over the next five years, stealing market sharefrom OPEC producers and moving the United States, once theworld's top oil importer, closer to self sufficiency.

<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^GRAPHIC: U.S. oil rig count

http://reut.rs/2Fc8KjXGRAPHIC: Russia vs Saudi vs U.S. oil production

http://reut.rs/2EIuTWS

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