WTI off intra-day highs as OPEC revises US output forecasts higher
The Organisation of the Petroleum Exporting Countries has revised its projections for US shale output in 2017 and 2018 higher even as the degree of forward cover in the industrialised world continued to rise.
In its latest Monthly Oil Market Report, OPEC forecast the rate of growth in oil supplies from outside the cartel of producer countries would increase by 150,000 and 120,000 barrels a day, respectively, in 2017 and 2018.
US shale oil would account for the bulk of that, with output now seen increasing by 1.05m b/d in 2018, that was 180,000 b/d more than previously estimated which was on top of a 610,000 b/d rise in the previous month.
Even so, commenting on the data Thomas Pugh at Capital Economics believed producer countries were still underestimating by how much US production would rise.
Hence, the market was still likely to be in a small surplus in 2018, Pugh said.
Also according to the MMOR, OPEC indicated that according to secondary market sources its own production fell by 133,000 b/d to an average level of 32.45 mb/d, mainly as a result of oil field maintenance in Angola and declines in Venezuelan output as the economic crisis took its toll on output.
On the heels of the above, as of 1513 GMT front month West Texas Intermediate crude oil futures were up by 0.24% to $57.28 a barrel but well off their intraday highs.