Oil prices claw back some ground, but demand worries drag

Oil prices claw back some ground, but demand worries drag

Washington will consider waivers for Iranian oil buyers such as India but they must eventually halt crude imports from Tehran, US Secretary of State Mike Pompeo said last week in New Delhi after a meeting of high level officials.

A slowdown in US production growth next year comes at a delicate time for oil markets, especially with Iran production being curtailed while uncertainties remain in Venezuela, Libya and Nigeria, all three are OPEC producers.

The energy information administration and the International Energy Agency, a global group of oil-consuming nations, had predicted that the USA would eventually pass Russian Federation and Saudi Arabia but possibly not until 2019. The pace of drilling slowed after oil prices tumbled starting in 2014, but roared back as operators learned to produce oil more efficiently and crude prices rebounded.

The build-up in Iranian oil supplies underscores the pressure that Iran is facing as Washington aims to bring Iranian oil exports down to zero to force Tehran to re-negotiate a nuclear deal.

The U.S., in news that was widely covered by media at the time, bypassed Saudi Arabia in February to become the second largest global oil producer, the EIA says.

The IEA noted in its report that Iraqi production jumped by 90,000 b/d in August and with its exports running at almost 4 million b/d, it had shipped more crude than Iran produced.




At press time, Brent crude is trading at $78.35 per barrel, having clocked a low of $77.87 yesterday.

Drillers added two oil rigs in the week to December 1, bringing the total count up to 749, the highest since September, General Electric Co's Baker Hughes energy services firm said in its closely followed report on Friday.

The figures show Libya was the highest contributor, increasing its production by 270,000 barrels per day while the total OPEC production increased by 230,000 barrels per day.

The more pressing issue is the fact that Iran's exports are falling faster than most analysts had anticipated. According to the IEA, global oil supply grew by a record 100 million barrels per day (bpd) in August.

Elsewhere in his remarks, Kazempour Ardebili suggested that a deal reached between OPEC and non-OPEC producers in 2017 over production ceilings had already lost effect.

However, after crude oil prices increased in early 2016, investment and production began increasing later that year. On Wednesday, OPEC's analysis arm said demand for the cartel's own crude oil will be nearly 1 million bpd more than the level produced in August.

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