Crude Oil Steadies After EIA Inventories

The market was still under pressure, though, from a bearish outlook by the International Energy Agency, which lowered its forecast for oil demand for 2018. The API reported an increase of about 2.03 million barrels in distillate inventories for the week ended October 6. US light crude was down 67 cents to $50.63 a barrel.

WTI light sweet crude oil fell 70 cents, or 1.4%, to settle at $50.60/bbl.

Brent also rose 2 percent the previous day.

High U.S. production is pushing increasing volumes of U.S. crude into world markets, feeding inventories and undermining OPEC's efforts to tighten the market.

US crude oil prices trim earlier losses after USA government data showed domestic crude stockpiles falling for the third week in a row; WTI now -0.9% at $50.84/bbl. Platts survey showed analysts expecting a draw of 1.4 million barrels in gasoline and a draw of 1.64 million barrels in distillate stocks.

Angola's oil output recorded a further drop in September, albeit of just 2,900 barrels per day, but widened the gap in relation to Nigeria, which remains the main oil producer in Africa, the Organisation of Petroleum Exporting Countries (OPEC) said.

Carsten Fritsch, commodities analyst at Commerzbank in Frankfurt, said the tone of the IEA report was bearish because it suggested that demand for OPEC crude next year would not be sufficient to absorb all the available supplies.

This supports what I have been saying all along that prices are likely to remain rangebound until OPEC and other major producers vote to extend the production cuts beyond the May 2018 deadline and also decide to deepen those production cuts.

US commercial crude oil inventories decreased by 2.8 million barrels from the previous week, the EIA said. For 2018, oil demand is expected to rise by 420,000 bpd vs 400,000 bpd previously.

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