Oil prices rise as concerns about oversupply ease

An oil tanker is being loaded at Saudi Aramco's Ras Tanura oil refinery and oil terminal

An oil tanker is being loaded at Saudi Aramco's Ras Tanura oil refinery and oil terminal

Ultimately, the price hike serves the interest of oil-dependent economies like Saudi Arabia, Russia and Iraq, especially since they can serve as substitutes for Iranian oil. As of previous year, 14.4 percent of its crude oil imports were from Mexico. Notwithstanding, the irony of the situation is that even though this production level blew away expectations and is indeed historic, it still may not be enough to satisfy our raging ravenous oil demand in the short term. The potential release of oil from the strategic petroleum reserve and the pressure from the Trump administration on Saudi Arabia to increase output has increased uncertainty.

Brent crude futures had fallen 21 cents, or 0.3 per cent, to $72.69 a barrel by 0615 GMT.

Oil companies are planning to make up for the shortfall by increasing purchases from other Middle Eastern suppliers, such as Saudi Arabia, since imports of Iranian crude will likely stop by around October, the sources said. Prices have since retreated to about $73 as Libya restored some halted output and the escalating U.S. Total commercial petroleum inventories increased by 6.0 million barrels last week. U.S. oil production continues to break records, topping 10.9 mb/d in the last few weeks, an all-time high.

OPEC and non-OPEC's compliance with oil output curbs has declined to around 120 percent in June from 147 percent in May, two sources familiar with the matter told Reuters on Wednesday.

Since quitting the worldwide nuclear agreement with Iran, the Trump administration has sent conflicting signals, indicating last month that it meant to choke off Iranian crude exports entirely. That was the biggest increase since the end of 2016.

Media: Japan halts imports of oil from Iran
Russia investing $64 billion in Iran’s oil and gas

But the spectre of oversupply quickly returned, with a rise of more than 600,000 barrels in USA crude stockpiles, reported by the American Petroleum Institute late on Tuesday.

After pulling out from the Iran Nuclear Deal on May 8, the US President promised that not only will the US reimpose the old sanctions against Tehran but also a new series of sanctions will be stamped on Iran.

"Refining margins in Asia are under pressure and some of the Chinese independent refiners have cut back on their processing, which is weighing on the Brent market", said Andrew Lipow, president of Lipow Oil Associates in Houston. However, comments by Saudi Arabia's Energy Ministry, pledging not to flood world markets with oil, turned the momentum around on Thursday and helped the commodity to rebound sharply from an intraday low level of $66.62.

"That's the takeaway from Wood Mackenzie's latest long-term outlook for global oil supply", reports OilPrice.com, an industry site.

Thousands of Amazon Workers Strike at European Warehouses Over Working Conditions
If you're not already a member, there's no better time than Prime Day to make the most of your 30-day free trial . Right now Amazon has a package deal for Xbox Game Pass for $59.99 , which you can redeem and use immediately .

France claims victory in 2018 World Cup
Following the final France - Croatia match on Sunday, Putin thanked the fans and praised their behavior as "simply attractive ". Another said: "We are few, but we believed and that is enough".

Vladimir Putin proud of Russia's hosting of tournament
There were nearly no protests, though four demonstrators barged onto the field during the final and were quickly hauled away. Messi's chance of winning the World Cup may be over, too, with the Barcelona star 35 at the next tournament.

Latest News