Global Oil Price dips as US inventory build stokes supply fears
Global Oil price eased in morning trade on Wednesday as data showing a build in US crude stockpiles.
Brent Crude futures fell by 13 percent to $42.95 a barrel.
Prices have been in a narrow band over the past 2 weeks due the concerns about the spike in covid-19 cases globally.
US crue oil stockpiles rose in the last week, Also gasoline and distillate inventories fell more than expected, data from industry group
The U.S. Energy Information Administration’s (EIA) said on Tuesday U.S. petroleum production is predicted to fall by 600,000 barrels per day (bpd) in 2020, a smaller decline than the 670,000 bpd it forecast previously.
However, it also expected global oil demand would recover through the top of 2021, predicting demand of 101.1 million bpd by the fourth quarter of next year.
“The EIA’s forecast of a lower decline in U.S. output was partially offset by its outlook for firm demand recovery, which limited losses in oil markets,” Hiroyuki Kikukawa, head of research at Nissan (OTC:NSANY) Securities said.
“Still, expectations that the Organization of the Petroleum Exporting Countries (OPEC) and allies would taper oil output cuts from August and softer U.S. equities added to pressure,” he said.
Abu Dhabi National Oil Co (ADNOC) plans to spice up oil exports in August, the primary signal that OPEC and its allies, together referred to as OPEC+, are preparing to ease record oil output cuts next month, three sources conversant in the event told Reuters.
Key ministers of the OPEC+ are thanks to hold talks next week.
Meanwhile, the amount of confirmed coronavirus cases within the us pushed past 3 million on Tuesday, consistent with a Reuters tally.