SINGAPORE
(Reuters) - Oil prices fell on Wednesday after a rise in U.S. crude inventories
and ongoing high output from OPEC producers revived concerns of a fuel
supply
overhang.
Brent crude
futures LCOc1, the international benchmark for oil prices, were at $48.64 per
barrel at 0613 GMT, down 20 cents, or 0.4 percent, from their last close.
U.S. West
Texas Intermediate (WTI) crude futures CLc1 were at $46.22 per barrel, down 18
cents, or 0.4 percent.
U.S. crude
stocks rose last week, adding 1.6 million barrels in the week to July 14 to
497.2 million barrels, industry group the American Petroleum Institute said on
Tuesday.
Outside the
United States, supplies from the Organization of the Petroleum Exporting
Countries (OPEC) remained high, largely because of rising output from
member-states Nigeria and Libya, despite the club's pledge to cut production.
"Production
in Libya is currently reported at or above 1 million barrels per day, while
August loading schedules for Nigeria have risen to just over 2 million barrels
per day," BNP Paribas said.
The French
bank said that the rising output from Nigeria and Libya eroded 40 percent of
the 1.25 million barrels per day cut by other OPEC members since the beginning
of the year.
A Saudi
Arabian industry source said on Tuesday that the kingdom, which is by far
OPEC's biggest producer, was committed to tighten the market.
"We
hope to accommodate the rise in production from Libya and Nigeria taking into
consideration other supply adjustments as well. But we emphasize that we have
to work together with other producers and with the two countries," the
source said.
Nigeria and
Libya are exempt from the deal between OPEC and other producers, including
Russia, to cut production by around 1.8 million barrels per day between January
this year and March 2018 .
"Talk
of capping Nigerian and Libyan output has been growing fast (within OPEC). But
it is very unlikely that both countries will acquiesce to a cap so soon after restoring
production," BNP said.
On the
demand side, BMI Research warned that China's near record refinery use of crude
oil in June would likely fall in the second-half of the year.
"The
pace of refining throughput growth in China is set to ease in H2, as the
Chinese economy loses steam amid intensifying efforts to curb financial risks,
and utilization rates at the independent private refineries soften amid lower
quotas and a tighter regulatory environment," BMI said.
Reuters*
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