Oil struggles for direction as USA output concerns persist

Oil struggles for direction as USA output concerns persist

Oil struggles for direction as USA output concerns persist

USA crude oil production rose to 9.25 million barrels per day, official data showed, up nearly 10 percent since mid-2016. Andrew Lipow, president of Lipow Oil Associates in Houston, said some in the market were concerned about the rapid recovery in shale production."Perhaps the amount coming out of the ground might be more than we anticipate", he said.

"We are still in a very well-supplied crude market in the U.S. The gasoline build was a bit of a surprise but makes sense given that this is the time of year refinery runs increase", Wellington, Florida-based Energy Analytics Group LLC director, Thomas Finlon, told Bloomberg by telephone.

Last week the prices of oil had gone past $53 a barrel following the push by some producers to extend the OPEC supply cut deal by the more than 6 months that had been settled on.

US crude futures were down 9 cents at $50.50 a barrel.

Crude futures were trading more than 30 cents higher in Asia early Thursday, but the recovery, against a rout of almost $2/barrel at the previous day's close, was more likely bargain-hunting than the start of a full correction, as the weekly counter-seasonal build in United States gasoline inventories continued to weigh on market sentiment.

US gasoline stocks posted a counter-seasonal build of 1.5 million barrels, despite heavier refining activity. This was in contrast to what analysts had earlier projected - a dip of about 1.4 million barrels.

French media report 2 police have been shot in Paris
Police have also issued an arrest warrant for a second suspect in the shooting, according to a document obtained by Reuters. He was shot to death after opening fire on a police van. "Police officers were deliberately targeted", Henry-Brandet added.

The fall in oil prices was, however, given some support by a report indicating that there was a decline in output in Saudi Arabia.

Iran was allowed to increase its output under the deal as the nation rebuilds from global sanctions that pressured its energy industry. Despite a drop in USA crude stocks last week, an unexpected 1.5-million-barrel build in gasoline stocks drove prices more than 3.5 percent lower on Wednesday.

Thirteen members of the Organisation of the Petroleum Exporting Countries (OPEC) and 11 non-OPEC members agreed to cut production by about 1.8 million barrels a day to prop up oil prices in December a year ago.

"Saudi's done a good job of managing the rhetoric", said Michael Hiley, a trader at LPS Futures LLC.

However, any interpretations of an oversupplied market moving towards a balance become questionable if product stocks start rising, especially gasoline, which should now be seeing a seasonal hump in demand.

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