Oil falls to $46, Nigerian cargoes face competition

Oil falls to $46, Nigerian cargoes face competition”

"Opec 2017 year-to-date exports are only down by 300,000 barrels per day from the October 2016 baseline", analysts at AB Bernstein said.

SINGAPORE, June 16 Oil prices edged up on Friday but remained near six-month lows, held down by an ongoing supply overhang that persists despite an OPEC-led effort to cut production and prop up crude markets. However, that optimism seems to be fading amid higher production from the United States and reports of impatience within the OPEC with lower oil price.

The rise in USA production has surprised most analysts.

Both the benchmarks, the Brent crude futures and U.S. West Texas Intermediate (WTI) crude futures were at were up 42 cents at $47.34 per barrel and $44.74 per barrel, up 28 cents, respectively.

Oil has declined nearly 8 percent this month amid speculation increasing US supplies will offset production curbs by the Organization of Petroleum Exporting Countries and its allies including Russian Federation.

According to Platts, Nigeria will experience a slight surge in price of Brent crude, despite the recent increase in supply of crude oil globally, a development, which has threatened cut in oil production introduced by the Organisation of Petroleum Exporting Countries (OPEC) for its members. This is inches higher from the expected output which was 2.7 million barrels for last week.

The IEA has revised its forecast upwards for USA oil production this year, and said Brazil and Canada were also expected "to make further gains".

The watchdog said its first forecast for 2018 made "sobering reading for those producers looking to restrain supply".

US production is up 10 percent over the past year to 9.33 million bpd, close to top producers Russian Federation and Saudi Arabia.

"There may be a surprise to the upside again", the agency said in reference to Russia's oil output.

Some traders still hope that Wednesday's readings from the USA government will show declining inventories for oil and gasoline, as numbers from the Energy Information Administration don't always match those from the API.

The upshot of all of this is as obvious as it will be disheartening to petrostates: the oil market will swing further into oversupply next year. All these data dampened sentiment and led to a sharp fall in crude oil prices.

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