Oil rescued from price lows by Libyan supply disruption

Oil rescued from price lows by Libyan supply disruption

Signs of strength in the USA economy and data showing American explorers curtailed drilling activity is helping oil hold gains after its biggest jump in seven months. gathers that Brent sweet crude was at 65.70 dollars per barrel, up 21 cents, or 0.3 per cent, from their previous close.

"Permian and Bakken shale basins still saw active oil rigs rising by two and three last week, respectively and are likely to keep United States oil production on increasing trend", ING said.

That is not far off the 2.957 percent yield on February 21, the highest since the instrument yielded more than 3 percent in January 2014.

However, if predictions from Warren Patterson, a commodities strategist at ING Groep NV, prove accurate, Iran has nothing to worry about: because US activity is angering OPEC allies to the degree they will soon abandon the cartel's production cutback deal, pump all out, and drive prices back down again.

Source Commonwealth Bank
Source Commonwealth Bank

Oil markets climbed on Monday, March 12, on the back of a drop in the number of United States rigs drilling for more production and as the US economy continued to create jobs, which industry hopes will drive higher fuel demand, NAN reports. Total volume traded was about 37 percent below the 100-day average. The global benchmark widened to a $3.89 premium to May WTI. Years of mismanagement and lack of investments in the oil industry contribute to the massive drop in production, and in January Venezuela pumped 1.6 million bpd, down by 47,300 bpd compared to December 2017-the largest monthly decline in oil production among OPEC's 14 member states.

US production is also expected to rise above 11 million bpd by late 2018, taking the top spot from Russian Federation, according to the International Energy Agency (EIA).

Workers at Libya's Zawiya oil export terminal started a strike on Monday over delayed salary payments, according to people with knowledge of the matter, who asked not to be identified because they are not authorized to speak to media.

US crude production from major shale formations is expected to rise by 131 000 bpd in April from the previous month to a record high 6.95 million bpd, the US Energy Information Administration (EIA) said in a monthly productivity report on Monday.

Among refined products, Nymex reformulated gasoline blendstock-the benchmark gasoline contract-was down 0.5%, at $1.89 a gallon.

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