U.S. OIL PRODUCTION: 9.35 - 9.91 MBD
PLATTS - Higher production of light sweet crude from Libya, Nigeria and the US in July could be contributing to a price squeeze between light and medium crudes, the US Energy Information Administration said Tuesday.
Libyan crude output jumped 19% to 1.01 million b/d in July, from 850,000 b/d in June. Nigerian production increased 6% to 1.66 million b/d in July, from 1.56 million b/d a month earlier, EIA said in its Short-Term Energy Outlook.
US crude production increased a more modest 1% to 9.43 million b/d, compared with 9.32 million b/d in June, the report said.
The increases come as voluntary production cuts by OPEC and non-OPEC countries tightens supply of medium sour and heavy sour barrels.
"As a result, over the past several months, the usual premium that light sweet crude oils command over medium and heavy crude oils has declined in many regions around the world," the report said.
EIA continues to expect US production to rise over the next two years and cross the 10 million b/d threshold in November 2018.
It sees output averaging 9.35 million b/d in 2017, up 20,000 b/d from last month's outlook, and 9.91 million b/d in 2018, up 10,000 b/d from last month.
"US oil production growth could slow as some US energy companies plan less investment spending for the rest of this year and the number of drilling rigs has recently increased at a slower clip," EIA Acting Administrator Howard Gruenspecht said in a statement.
OPEC crude production held steady in July at an average 32.93 million b/d, compared with 32.61 million b/d in June, despite the sharp increases in Libya and Nigeria.
Saudi Arabia produced 10.2 million b/d in July, steady from 10.15 million b/d a month earlier.
The agency expects OPEC output to average 32.53 million b/d in 2017 and 32.96 million b/d in 2018.
EIA expects Brent crude prices to average $50.71/b in 2017 and $51.58/b in 2018 and WTI prices to average $48.88/b in 2017 and $49.58/b in 2018 -- steady from the agency's June outlook.
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BLOOMBERG - As Saudi Arabia led OPEC’s output cuts this year to shrink a global glut, it’s lost out on market share in the world’s biggest energy consumer. Russia in September retained the top Chinese supplier spot for the seventh straight month, while the kingdom was third.
PLATTS - The quality of Russia's key Urals crude exports towards Europe will continue to fall next year as more of the country's low-sulfur oil flows are diverted eastward to China, Russian national oil pipeline operator Transneft warned.
FT - OCI — the world’s third-largest polysilicon maker by capacity and South Korea’s biggest — this month reported a 3,373 per cent increase in operating profit to Won78.7bn ($72m) for the July-September quarter, its best performance in five years. Rival Hanwha Chemical saw third-quarter net profit jump 25 per cent to a record Won252bn.
U.S. Rig Count is up 330 rigs from last year's count of 593, with oil rigs up 273, gas rigs up 58, and miscellaneous rigs down 1 to 0. Canada Rig Count is up 41 rigs from last year's count of 174, with oil rigs up 13, gas rigs up 30, and miscellaneous rigs down 2 to 2.