US Crude Oil Exports Increased Following Hurricane-Related Refinery Disruptions

US Crude Oil Exports Increased Following Hurricane-Related Refinery Disruptions

OPEC members are enjoying the extra income, though some in the group have expressed concern that it could encourage US shale and other supply from outside producers. This news overshadowed a government report earlier in the week which showed US production at a 50 week high.

Brent futures, the global benchmark, were down 8 cents at $69.57 a barrel by 1104 GMT.

Sure enough, the boost to prices from OPEC's strategy has invigorated USA output, which surged to a 47-year high of 10 million barrels a day in November.

Crude still has support because of output cuts by large producers and strong demand. As a result, Brent prices could hit $82.50 per barrel by the summer.

OPEC shared this view, but then surprised the market in September 2016 by announcing their intention to cut supply.

A decade ago, falling domestic production and a USA ban on exports meant that WTI served mostly as a proxy for United States inventory levels. "The history shows sudden price rises are not helpful to oil exporters in the long run". That's a number that challenges daily production of just less than 10mn barrels by Saudi Arabia in December and nearly 11mn by Russian Federation a year ago.

The Energy Department said Thursday that average crude production reached 10.038 million barrels a day in November, just below the record of 10.044 million barrels a day set in November 1970. The deal was signed by Tehran and the USA, the UK, Russia, France, China, and Germany.

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Goldman's short-term optimism presumably baffles Tom Kloza, global head of energy analysis at the Oil Price Information Service: he told CNBC that crude has entered a danger zone due to "the tremendous speculative bubble and the money on the crude oil side". That also gives USA shale producers more opportunity to lock in profits on their own production.

Nonetheless, forecasters are predicting prices will return to levels considered unthinkable during the downturn, despite the USA supply.

Today, crude oil is gaining to recover some of the gains it had yesterday. Production in North Dakota was 1.18 million b/d.

Iraq will begin exporting next week 60,000 bpd of oil from the fields in Kirkuk to an Iranian refinery across the border via tanker trucks, in exchange for refined oil for southern Iraq.

"The rebalancing of the oil market has likely been achieved, six months sooner than we had expected", the bank's analysts said in a report, as it revised higher its global demand growth forecast to reflect surging imports from emerging markets.

The bank forecast returns from S&P GSCI enhanced commodity index at 7.4, 14.7 and 10 percent for 3, 6 and 12 months, respectively.

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