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UPDATE 2-Oil edges down as rising output stokes concern on oversupply

Published 02/05/2017, 04:45 pm
Updated 02/05/2017, 04:50 pm
© Reuters.  UPDATE 2-Oil edges down as rising output stokes concern on oversupply
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* Global output recovery in Libya, Canada, U.S.

* U.S. crude stocks likely fall for fourth straight week-poll

* U.S. inventories stood about 10 pct above year-end levels

* API industry data due out at 2030 GMT (Updates prices, adds details)

By Osamu Tsukimori

TOKYO, May 2 (Reuters) - Oil prices edged down on Tuesday, as rising output stoked worries that OPEC-led production cuts may not significantly tighten a bloated market.

Oil has been weighed down by the market's impatience with the slow pace of inventory drawdown, even after major oil producers agreed to cut production by 1.8 million barrels per day for the first half of 2017.

U.S. crude inventories are expected to mark a fourth straight week of declines from a record high hit at the end of March, but stocks are still seen about 10 percent above year-end levels, according to Reuters calculations. EIA/S

London Brent crude for July delivery LCOc1 was down 18 cents, or 0.4 percent, at $51.34 by 0631 GMT, after settling down 53 cents on Monday. Brent hit a one-month low of $50.45 last week after the restart of two key Libyan oilfields.

NYMEX crude for June delivery CLc1 was down 20 cents, or 0.4 percent, at $48.64.

Oil did win some support after data showed that Russian oil output fell slightly to 11 million barrels per day (bpd) in April from 11.05 million bpd in March. Organization of the Petroleum Exporting Countries and participating non-OPEC countries meet on May 25 to discuss whether to extend coordinated curbs in production into the second half of the year.

"Excess supplies are noticeable, particularly in Europe, which is curbing Brent's gains," said Kaname Gokon at brokerage Okato Shoji in Tokyo. "Overall, the demand is weakening and the inventories pile up."

Weighing on oil, Libya's National Oil Company said production has risen above 760,000 bpd to its highest since December 2014, with plans to keep boosting production. crude output C-OUT-T-EIA is at its highest since August 2015, while the Syncrude Canada oil sands project has started shipping crude from its Mildred Lake upgrader again after cutting production due to a fire at the plant in mid-March. RIG/U crude inventories likely fell by 2.2 million barrels last week, while refined product stockpiles were seen up, a preliminary Reuters poll showed.

Industry group, the American Petroleum Institute (API), is scheduled to release inventory data for the week to April 28 at 4:30 p.m. EDT (2030 GMT) on Tuesday.

Elsewhere, a private survey showed on Tuesday that China's factory sector lost momentum in April, with growth slowing to its weakest pace in seven months. TECHNICALS-Brent oil may stabilize around $51.30 and rise

ID:nL4N1I40HG TECHNICALS-U.S. oil may stabilise around $48.67 and then retest $49.18

ID:nL4N1I40NH

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