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Oil Prices Start the Week Lower Amid Rising U.S., Russia Output

Published 11/06/2018, 08:36
Updated 11/06/2018, 08:41
© Reuters.  Oil Prices Start the Week Lower
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Investing.com - Oil prices got off to a lackluster start on Monday, as rising U.S. crude production and expectations that OPEC members will raise supplies remained in focus.

U.S. West Texas Intermediate WTI crude was down 29 cents, or around 0.4%, at $65.47 a barrel at 3:35AM ET (0735GMT).

The U.S. benchmark logged a weekly loss of 0.1% last week, the third such decline in a row.

Underscoring worries over rising output, U.S. drillers added one oil rig last week, bringing the total count to 862, the highest number since March 2015, General Electric (NYSE:GE)'s Baker Hughes energy services firm said in its closely followed report on Friday.

U.S. crude production has been rising to record levels since late last year. Domestic oil output - driven by shale extraction - is currently at an all-time high of 10.8 million barrels per day (bpd).

Fresh weekly data on U.S. commercial crude inventories on Tuesday and Wednesday will help gauge the strength of demand in the world’s largest oil consumer and offer fresh indications on how fast output levels continue to rise.

Elsewhere, Brent crude futures shed 44 cents, or 0.6%, to $76.02 a barrel. It finished down 0.4% last week, suffering weekly drops in two of the past three weeks.

Fresh comments from global oil producers for additional signals on whether they plan to exit their current production-cut agreement will remain at the forefront of the oil market in the week ahead.

The Organization of Petroleum Exporting Countries (OPEC) is due to meet at its headquarters in Vienna, together with non-OPEC member Russia, on June 22 to discuss production policy.

Oil prices have been on the backfoot recently on concerns that OPEC and non-OPEC members led by Russia would decide to lift output by up to one million bpd as early as this month in reaction to lost supplies out of Venezuela and Iran.

OPEC and non-OPEC producers have been curbing output by about 1.8 million bpd to prop up oil prices and reduce high global oil stocks. The pact began in January 2017 and is set to expire at the end of 2018.

However, Saudi Arabia and Russia have said cuts could be eased after receiving calls from consumers including the United States, China and India to support global demand.

Russian news agency Interfax reported on Saturday that Russia's oil production, the world's biggest, had risen to 11.1 million bpd in early June, up from slightly below 11 million bpd in most of May and well above its target production of under 11 million bpd as part of the deal.

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