A separate report showed that USA oil production recovered to 9.4 million barrels per day, which is the highest level of production since August 2015, however.
Crude oil prices were nevertheless sliding in early Monday trading as investors looked ahead to next week, when parties to an OPEC-led effort to balance the market meet to review the impacts. The agency said that demand would expand by 1.4 million barrel per day (mb/d) this year, or about 0.1mb/d faster than it previously thought.
Combined, Libya and Nigeria have increased output from 2.048 million bpd in April to 2.585 million bpd in June, and a cap would merely hold steady these levels of production, and would still take away from OPEC/NOPEC production quotas that promised to cut production by 1.8 million bpd.
"The slowing pace of increases combined with massive drawdowns last week on both official crude inventory numbers from the United States probably explains the positive sentiment in general at the moment".
Technically, MCX crude oil price steadily moved higher as it recovered from two-week lows near Rs 2,820 to close the last week near Rs 3,000 level, higher by about 4.5 per cent for the period. Iran, Algeria and Iraq also gamed the Opec deal by ramping up production during the two months between the negotiation of the Saudi-brokered pact and the year-end deadline for output cuts. Three years ago, in July 2014, Brent crude traded at $110 a barrel, on the eve of an epic crash that saw the price of the world's preeminent light sweet crude benchmark plunge to $28 a barrel by February 2016. This rather ambiguous statement by Barkindo that OPEC was meeting with shale oil producers inevitably leads to questions about which firms were actually present at that meeting. Net long positions in the West Texas Intermediate futures contracts were slashed, the reason it fell as low as $42 in late June.
While oil advanced last week, prices in NY are still below $50 a barrel on concerns expanded global supplies will offset output curbs by the Organization of Petroleum Exporting Countries and its allies.
Asian traders are selling oil products out of tanks amid soaring demand, while the EIA reported the largest drop in USA crude oil inventories in the week to last week in 10 months. Yet, the decline may not be as severe as OPEC fears-a possibility that would further poke gaping holes into precarious oil-dependent budgets.
Chinese crude oil imports improved. This is the reason I accumulate Total at?42, Chevron at 102, Oxy at 58.
OPEC is now hoping that demand will continue to rise in the second half of the year. The time to be an oil bear is over. This means a cyclical bottom in Brent crude.