Forecast for the price of Brent crude oil cut by 8 percent

Modesto Morganelli
Luglio 5, 2017

The day before, the Qatari company announced it would work to boost its production of liquid natural gas from its North Field by 20% or 4bn cubic feet of gas per day, which was equivalent to a 1.0m barrel of oil equivalent per day increase from then current levels.

Compliance among parties to the agreement, which includes big non-OPEC producers like Russian Federation, has been generally strong, though Saxo Bank said the impact has been muted because cuts in exports aren't on par with cuts in production.

OPEC exports rose for a second month in a row in June to 25.92 million bpd, up 1.9 million bpd from the same month past year, according to Thomson Reuters Oil Research.

Light synthetic crude from the oil sands for August delivery last traded at 55 cents per barrel over WTI, having settled at 35 cents over the benchmark on Friday.

Oil exports by the Organization of the Petroleum Exporting Countries (OPEC) climbed for a second month in June, according to Thomson Reuters Oil Research, despite its pledge to hold back production between January this year and March 2018 to prop up prices.

Forecast for the price of Brent crude oil cut by 8 percent
Forecast for the price of Brent crude oil cut by 8 percent

Another analyst said the strong dollar provided less incentive to invest in greenback-denominated commodities such as crude oil.

The ANZ made an announcement that "Rising geopolitical risks should provide some support to gold and oil prices", Crude prices seem locked below $50 per barrel amidst the happenings. "The return of Libya and Nigeria and USA are completely offsetting OPEC's measures". Opec exported 25.92m bpd in June, up 450,000 bpd from May and 1.9m bpd more than a year earlier.

The bearish outlook also led Saxo Bank to cut its year-end Brent crude price forecast to $53 a barrel from $58.

Traders were also eyeing weekly USA crude inventory data, delayed by a day due to the US public holiday on Tuesday. The weekly data showed a surprise rise in inventories last week.

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