Oil Prices Recover after Output from United States
October 01, 2019 | Monday
Oil prices revived on Tuesday on reports that production at the world's largest oil producers fell during the third quarter. Contrarily, a resumption in Saudi supply-demand concerns continued to keep a lid on prices.
December Brent crude futures surged 25 cents or 0.42% to $59.50 a barrel. U.S. West Texas Intermediate crude for November was up 25 cents, or 0.46%, at $54.32 a barrel. On Monday, front-month prices for both contracts posted their largest quarterly falls this year. It was affected by a slowdown in global economic growth amid the U.S.-China trade war. Moreover, with Brent averaging $65.19 a barrel and WTI $57.96 in 2019, oil prices are likely to remain steady. Also, flagging demand outweighs supply shocks.
So far this year, Brent has averaged $64.72 a barrel, while WTI has averaged $58.13. The head of a trading arm of Saudi Aramco says it restored full oil production and capacity to the levels they were ar before the attacks. Saudi Arabia pumped about 9.78 million bpd in August.
OPEC's production fell to the lowest in eight years in September at 28.9 million bpd. Also the lowest monthly total since 2011 was down to 750,000 bpd from August's revised figure. Furthermore, the U.S and Russia's outputs also fell in July and September, respectively. Russia's production fell to 11.24 million bpd on Sept. 1-29, down from 11.29 million bpd last month. Still, it's above the quotas set in an output deal between Russia and OPEC. In July, U.S crude oil output fell 276,000 bpd to 11.81 million bpd as federal offshore Gulf of Mexico production slid.
Also, in April, U.S production peaked at 12.12 million bpd. Distillate stocks probably slipped, while U.S crude oil stockpiles likely rose 1.1 million barrels last week, Reuters poll showed on Monday.
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