Crude Oil Prices Settle 5% Lower as Libya Resumes Exports, OPEC Output Jumps

Investing.com – WTI crude oil prices settled sharply lower Wednesday, shrugging off a larger-than-expected draw in U.S. crude stockpiles as raising OPEC output, and the reopening of terminals in Libya dented investor expectations for a global supply shortage.

On the New York Mercantile Exchange for July delivery fell 5% to settle at $70.38 a barrel, while on London’s Intercontinental Exchange, fell 6.7% to trade at $73.56 a barrel.

Inventories of U.S. crude fell by 12.633 million barrels for the week ended June 30, confounding expectations for of 4.489 million barrels, according to data from the Energy Information Administration (EIA).

The large draw in crude supplies came as imports fell by 1.624m barrels a day (bpd), and output remained roughly flat at 10.9 million bpd, the EIA said. The production shutdown at Canada’s Syncrude – which has capacity to produce 350,000 bpd of oil – continued to weigh on North American crude supplies.

Gasoline inventories – one of the products that crude is refined into – by 0.649 million barrels, missing expectations for a draw of 0.750 million barrels, while supplies of distillate – the class of fuels that includes diesel and – by 4.125 million barrels, against expectations for a build of 1.200 million barrels.

The mostly bullish inventory report failed to lift sentiment amid investor concerns about an increase in global supplies as OPEC output increased last month, while Libya resumed export activities, which could see as much as 0.7 million bpd return to the market.

OPEC output rose above 32.3 million bpd in June, up 173,000 bpd from the previous month, according to OPEC’s monthly report. The increase was led by a rise in Saudi output to levels not seen since the output-cut agreement in 2016.

Saudi Arabia reported that it pumped nearly 10.5 million bpd last month, up from about 10 million bpd in May.

OPEC, in its monthly report, said it expects the pace of oil demand growth to slow, but still increase by 1.45 million bpd in 2019.

The oil-cartel also said it expects non-OPEC production to rise by 2.1 million barrels in 2019, led by a surge in U.S. output.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.