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U.S. oil prices dip on rising crude inventories, record output

Published 07/02/2019, 00:56
Updated 07/02/2019, 01:00
© Reuters. A member of a drilling crew prepares to place a collar around drill pipe on an oil rig in the Permian Basin near Wink
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By Henning Gloystein

SINGAPORE (Reuters) - U.S. oil prices dipped on Thursday after U.S. crude inventories rose and as production levels in the country stayed at record levels, but OPEC-led supply cuts and the crisis in Venezuela supported markets.

U.S. West Texas Intermediate (WTI) crude futures were at $53.82 per barrel at 0036 GMT, down 19 cents, or 0.35 percent, from their last settlement.

International Brent crude oil futures had yet to trade.

U.S. crude oil inventories climbed by 1.3 million barrels in the week that ended Feb. 1, to 447.21 million barrels, data from the Energy Information Administration (EIA) showed on Wednesday.

Meanwhile, average weekly U.S. crude oil production remained at the record 11.9 million barrels per day (bpd) it reached in late 2018.

GRAPHIC: U.S. oil drilling, production & storage levels - https://tmsnrt.rs/2Q6Btw5

Countering the rising U.S. crude output and inventories are voluntary supply cuts led by the Organization of the Petroleum Exporting Countries (OPEC) aimed at tightening the market and propping up prices.

Meanwhile, U.S. sanctions against Venezuela's oil industry are expected to knock out at least 500,000 bpd of crude exports.

"We expect the oil price to rise in the first-half of 2019 on tightening supply conditions and decline in the second-half on weakening economic activity and an increase in U.S. crude exports to international markets," said French bank BNP Paribas (PA:BNPP).

© Reuters. A member of a drilling crew prepares to place a collar around drill pipe on an oil rig in the Permian Basin near Wink

It added that it saw average 2019 prices for Brent at $68 per barrel and for WTI at $61 per barrel, both down by $8 from its previous outlook.

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