UK Crude hits five-month high above $71 on Libyan supply threat

Lloyd Doyle
April 11, 2019

Brent crude futures, the global benchmark for oil prices, were up $1.04, or 1.5%, at $71.65 per barrel around 2:30 p.m., after hitting a five-month high.

"OPEC's ongoing supply cuts and USA sanctions on Iran and Venezuela have been the major driver of prices throughout this year, " said Hussein Sayed, Chief Market Strategist at futures brokerage FXTM.

Global benchmark Brent futures rose 44 cents to $71.05 a barrels barrel by 10:46 a.m. EDT (1446 GMT).

Oil prices hit their highest in five months on Tuesday, with Brent marking $71.34 per barrel and USA crude reaching $64.77 per barrel.

Net U.S. crude imports rose last week by 210,000 barrels per day (bpd) while exports alone fell by 374,000 bpd to 2.3 million bpd, the lowest level since late January.

Crude oil prices rose 0.07 percent to Rs 4,454 per barrel on Wednesday as speculators created fresh positions amid positive cues from global markets.

The OPEC monthly report released on Wednesday showed that Venezuela's oil output sank last month to a long-term low below 1 million barrels per day, due to US sanctions and blackouts.

The Dutch bank said the reduction was not only down to voluntary supply cuts, which the group started this year to prop up prices, but also involuntary curbs from Venezuela and Iran - which are exempt from the OPEC cut pact - due to US sanctions.

"Declines from these two exempt countries account for nearly 47% of the reduction seen from OPEC", ING added.

Restrictions at the busiest US energy port for days after a massive petrochemical fire and spill near Houston led to a backlog of vessels in late March.

Oil production in the United States has risen by more than 2 million bpd since early 2018, to a record 12.2 million bpd.

The bank said it expected Brent and WTI to average $70 per barrel and $59 per barrel respectively in 2019, and $65 per barrel and $60 per barrel in 2020.

On Tuesday, crude oil futures for May ended down $0.42, at $63.98 a barrel, after rising to a high of $64.79.

US crude exports have also risen, breaking through three million bpd for the first time earlier this year.

On the demand side, there are concerns that an economic slowdown will soon hit fuel consumption.

Other reports by Iphone Fresh

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