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Tuesday, 8 August 2017 | MYT 7:11 AM

Oil prices fall further in Asian trade as Libyan field resumes production(Update)

Global benchmark Brent crude futures were down 18 cents, or 0.3 percent, at $52.19 a barrel by 0038 GMT after dipping 0.1 percent in the previous session.  U.S. crude futures were down 13 cents, or 0.3 percent, at $49.26 a barrel, having fallen 0.4 percent on Monday

Global benchmark Brent crude futures were down 18 cents, or 0.3 percent, at $52.19 a barrel by 0038 GMT after dipping 0.1 percent in the previous session. U.S. crude futures were down 13 cents, or 0.3 percent, at $49.26 a barrel, having fallen 0.4 percent on Monday

TOKYO: Oil prices slipped further in Asian trading on Tuesday following a recovery in output at Libya's largest oil field and amid ongoing doubts about OPEC-led production cuts.

Global benchmark Brent crude futures were down 18 cents, or 0.3 percent, at $52.19 a barrel by 0038 GMT after dipping 0.1 percent in the previous session.

U.S. crude futures were down 13 cents, or 0.3 percent, at $49.26 a barrel, having fallen 0.4 percent on Monday.

Production from Libya's Sharara field was returning to normal after a brief disruption when armed protesters broke into a control room in the coastal city of Zawiya, the National Oil Corporation (NOC) said on Monday.

The field has been producing about 270,000 barrels a day (bpd), accounting for about a quarter of the country's output, which climbed to more than 1 million bpd in late June from just over 200,000 bpd a year ago.

Libya was exempted from a push to cut global production and bolster oil prices led by the Organization of the Petroleum Exporting Countries (OPEC) and other big producers like Russia.

The recovery of the North African country's output has complicated the bloc's efforts to curb supply, fueling doubts over the effectiveness of the output cuts.

OPEC output hit a 2017 high in July and its exports hit a record.

Officials from a joint OPEC and non-OPEC technical committee are meeting in Abu Dhabi on Monday and Tuesday to discuss ways to boost compliance with the deal to cut 1.8 million barrels per day in production.

Oil output in the United States remained high, although Baker Hughes data on Friday showed a cut of one drilling rig in the week to Aug. 4. - Reuters

Earlier Report:

Oil slides as output rises at Libya's largest oil field

NEW YORK: Oil prices fell as much as 2 percent on Monday on selling triggered by a rebound in production from Libya's largest oil field, along with worries about higher output from OPEC and the United States.

Output at Libya's Sharara field was returning to normal after a brief disruption by armed protesters in the coastal city of Zawiya, the National Oil Corporation (NOC) said. The field has boosted Libya's oil production, which climbed to more than 1 million bpd in late June.

Global benchmark Brent crude futures were down 26 cents, or 0.5 percent, at $52.16 a barrel at 2:05 p.m. EDT (1805 GMT) after trading as low as $51.37 a barrel

U.S. crude futures were down 34 cents, or 0.7 percent, at $49.24 per barrel, after seeing a low of $48.54 a barrel.

Both contracts stood below levels hit last week, which marked their highest since late May.

Doubts have emerged about the effectiveness of output cuts by the Organization of the Petroleum Exporting Countries and other big producers including Russia. OPEC output hit a 2017 high in July and its exports hit a record.

"The petroleum markets are tipping toward the lower end of their recent trading range as oil producers meeting in Abu Dhabi have been slow to assure the market that compliance with this year’s production cuts will be improved, although we continue to note that adherence to the limits has actually been quite strong by historical standards," Tim Evans, Citi Futures' energy futures specialist, said in a note.

"The recent increase in OPEC production has mostly been a function of recovering volumes from Libya and Nigeria."

Officials from a joint OPEC and non-OPEC technical committee are meeting in Abu Dhabi on Monday and Tuesday to discuss ways to boost compliance with the deal to cut 1.8 million barrels per day in production.

Oil output in the United States remained high even though Baker Hughes data on Friday showed a cut of one drilling rig in the week to Aug. 4, bringing the U.S. rig count down to 765. <RIG-OL-USA-BHI>

U.S. weekly oil production hit 9.43 million bpd in the week to July 28, the highest since August 2015 and up 12 percent from its most recent low in June last year. <C-OUT-T-EIA> Morgan Stanley said in a note on Monday it expects to see U.S. oil production growing by 900,000 bpd in the fourth quarter versus a year earlier, up from a forecast of 860,000 bpd earlier.

Some analysts expected OPEC could talk up prices.

"Saudi Arabia will restate that they will export only 6.6 million bpd (six-year low) in August and inventories will continue to draw down," SEB Markets chief commodities analyst Bjarne Schieldrop said.

On the global demand side, Goldman Sachs said data available so far for June points to continued strong growth.

"We believe that the biggest driver for this robust demand is strong economic growth in recent months," Goldman said in a note. - Reuters

Tags / Keywords: Oil & Gas , Commodities , Markets

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