Crude Oil Mixed In Asia After Disappointing API Estimates, Middle East Eyed

Investing.com – Crude oil was narrowly mixed in Asia on Wednesday as estimates from an industry group weighed on sentiment with Middle east tension however continuing to offer support.

On the New York Mercantile Exchange crude futures for December delivery fell 0.30% to $57.03 a barrel, while on London’s Intercontinental Exchange, rose 0.06% to $63.59 a barrel.

oil stocks fell by 1.562 million barrels last week, the American Petroleum Institute said on Tuesday, less than expected. Gasoline stocks rose by 520,000 barrels, while distillate inventories slipped 3.133 million barrels.

Analysts expected a 2.7 million barrels drop in crude seen, a 2.100 million barrels decline in distillates and a 2.176 million barrels easing in gasoline inventories expected. Supplies at the oil storage hub of Cushing, Oklahoma, rose by 812,000 barrels.

On Wednesday, the Energy Information Administration (EIA) releases official data. The API and EIA data sets often diverge.

Crude oil prices settled lower on Tuesday after OPEC said it expected a surge in North American shale output to cap demand for the cartel’s crude oil.

Crude oil pared some of Monday’s gains as an Opec report suggested that the recent rally in crude prices – as a result of the output-cut agreement – would encourage North America shale producers to ramp up output, weakening the oil cartel’s efforts to rebalance the market.

OPEC in its 2017 World Oil Outlook revised upwards North American shale oil to 5.1 million barrels per day (bpd) from 4.1 million bpd, citing the recent rally in crude prices as one of the catalysts to drive up shale output.

The U.S. Energy Information Agency in separate report also revised upwards its estimate for domestic crude oil production.

U.S. crude oil output will rise by 720,000 bpd to 9.95 million bpd in 2018, the EIA said. Last month, it expected a 680,000 bpd year-over-year increase to 9.92 million bpd.

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