|
 Analysts said that rising U.S. crude oil stocks, an increase in
Libyan oil production and the chance of an agreement between Iran
and the West that could ease sanctions on the oil producer and boost
its exports are all pulling prices lower.
"The focus is on the bearish side," said Bjarne Schieldrop, chief
commodities analyst with SEB in Oslow. "When people look at the
market now, they are looking at the possibility of an Iran
resolution,"
Brent, which rose to a session high of $54.38, was trading at
$53.11, down 33 cents, by 1016 GMT. The April contract that expired
in the previous session closed down $1.23 after hitting $52.50
earlier on Monday, its lowest since Feb. 2.
U.S. crude, or West Texas Intermediate (WTI), was at $43.11 a
barrel, down 77 cents and slightly above 6-year lows of $42.85
marked on Monday.
Though fighting between rival governments has complicated Libya's
oil production, an industry source said it has now risen to 489,000
barrels per day after the restart of the El-Feel and Wafa oilfields.
Further weekly data on U.S. crude inventories is due later on
Tuesday from industry group the American Petroleum Institute (API),
and some traders expect the gap between Brent and WTI to widen
further.
While the U.S. rig count dropped to 1,125 last week from 1,809 rigs
a year ago, past cycles have shown there is "often a lag between
when drilling stops and when oil supply stops growing", Morgan
Stanley said in a note.
"We expect WTI to remain under pressure as inventories swell further
as the seasonal maintenance period begins. We expect this to remain
the case in the short term," ANZ bank said.
[to top of second column] |
A Reuters poll showed a likely build in U.S. crude inventories for a
tenth week to a new record high.
Some see the possibility for markets to stabilise or even rise, with
Vitol Chief Executive Ian Taylor telling a conference on Tuesday
that oil markets would "come into balance" by the second half of the
year.
However the potential of a nuclear deal that could end sanctions
against Iran, allowing Tehran to send more of its oil into the
market, also dragged on oil markets.
"If sanctions were to be lifted, up to 1 million barrels per day of
additional oil could reach the market from Iran in the second half
of the year, making it more difficult for prices to recover,"
Commerzbank said in a note on Tuesday.
(Additional reporting by Keith Wallis and Henning Gloystein in
Singapore. Editing by William Hardy)
[© 2015 Thomson Reuters. All rights
reserved.] Copyright 2015 Reuters. All rights reserved. This material may not be published,
broadcast, rewritten or redistributed.
 |
