Oil drops 3 pct, pares OPEC gains on stock market weakness

Oil drops 3 pct, pares OPEC gains on stock market weakness

Oil drops 3 pct, pares OPEC gains on stock market weakness

After the news that supply would be cut, the price of oil rallied above $60 dollars a barrel, where it has remained, with Brent Crude trading at around $61 on Wednesday, while WTI Crude sits a touch over $52.

In a monthly report, the Organization of the Petroleum Exporting Countries said 2019 demand for its crude would fall to 31.44 million barrels per day, 100,000 bpd less than predicted last month and 1.53 million less than it now produces.

At the last OPEC meeting in Vienna, the agreement was again extended until the end of 2018.

UAE Energy Minister Suhail Al Mazroui has said that Qatar's decision to withdraw from OPEC would not affect the continuation of production.

In physical markets, Kuwait and Iran this week both reduced their January crude oil supply prices to Asia. Meanwhile, China's vice premier discussed a timetable and road map on trade talks with his USA counterpart.

Russian Federation said on Tuesday it plans to cut its oil output by 50,000 to 60,000 bpd in January, as part of a gradual means of meeting its commitment under the deal to cut by 220,000 bpd.

Brent climbed to as high as $63.73 per barrel on Friday after OPEC said it would begin curbing its production by 800,000 bpd for six months beginning January 2019.

Based on International Energy Agency's (IEA) forecast, Kotak estimates that incremental non-OPEC supply supported by rising production from the United States in CY2019 will now barely exceed incremental oil demand of 1.4 million barrels per day assuming OPEC and its allies manage supplies through the year.

The force majeure on Sharara crude and associated facilities brings a daily loss to the Libyan economy of $32.5 million, NOC stressed. Many, but most especially President Trump, feared oil prices would rise to the triple digits if Saudi Arabia and others did not increase output. The level is the lowest since September 20, 2016.

They claim the Fezzan region has suffered decades of neglect and demanded revenue of the oil produced from local fields be used to fund development projects.

The corporation confirmed it will not negotiate with the armed group and demanded them to leave the field immediately, accusing them of committing violence against the field's staff, robbery, and interrupting oil production.

Oil prices dived on Monday, erasing Friday's gains following an output cut deal between OPEC and its allies, as further global stock markets weakness spurred concerns over slowing global economic growth.

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