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UPDATE 2-Oil prices dip on high OPEC supplies, rising U.S. production

Published 04/08/2017, 03:18 pm
Updated 04/08/2017, 03:20 pm
© Reuters.  UPDATE 2-Oil prices dip on high OPEC supplies, rising U.S. production
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* U.S. oil production at highest since August 2015

* OPEC oil exports hit record high in July

* Record U.S. gasoline demand provides some support (Adds comments in paragraphs 7, 14 and 15; updates prices)

By Henning Gloystein

SINGAPORE, Aug 4 (Reuters) - Oil markets dipped on Friday, with U.S. crude remaining below $50 per barrel, restrained by rising output from the United States as well as producer club OPEC.

U.S. West Texas Intermediate (WTI) crude futures CLc1 were at $48.95 per barrel at 0516 GMT, down 8 cents, or 0.2 percent, from their last close and around 90 cents for the week.

Brent crude futures LCOc1 , the international benchmark for oil prices, were at $51.93 a barrel, down 8 cents, or 0.15 percent, from their last close and around 70 cents for the week.

Traders said prices were being pulled down by rising output, although strong demand prevented bigger drops.

"Developments this week have seen some pessimism return to markets," National Australia Bank said in its August outlook.

"We forecast Brent to trade at around $53 per barrel in Q4 2017," it said.

British bank Barclays (LON:BARC) said "we expect a downward (price) correction during this quarter," but see Brent at an average of $54 per barrel during the fourth quarter. oil exports by the Organization of the Petroleum Exporting Countries (OPEC) rose to a record high in July, driven largely by soaring exports from the group's African members, according to a report by Thomson Reuters Oil Research this week.

July's 26.11 million barrels per day (bpd) in exports marked a rise of 370,000 bpd, most of which came from Nigeria, which posted a rise of 260,000 bpd in shipments. the United States, oil production has hit 9.43 million bpd, the highest since August 2015 and up 12 percent from its most recent low in June last year. C-OUT-T-EIA

"Quarterly reporting season has seen a swathe of (U.S.) shale producers announce aggressive production targets, despite weak prices as they cut costs and become more efficient," ANZ bank said on Friday.

Strong demand is still preventing prices from falling.

U.S. gasoline demand rose to 9.842 million bpd last week, the highest since the U.S. Energy Information Administration began collecting the data in 1991, the federal agency reported this week. demand is now +0.1 percent (year-on-year). This is reasonably encouraging given it had been flat or negative since late November 2016," U.S. investment bank Jefferies said.

"Gasoline inventories in the U.S. fell for the seventh consecutive week ... and are now only 6.3 million barrels above the 5-year average," it said. EIA/S

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