Crude prices were seen falling as Brent crude futures were seen falling to its lowest level in 13 months on Wednesday, while futures for the West Texas Intermediate declined for a second day as the abundant supplies and the soaring production in the US pushed the EIA to lower its crude price outlook.
Futures for the North American West Texas Intermediate (WTI) crude for September delivery declined 0.26% to $97.12 per barrel on the New York Mercantile Exchange (NYMEX) at the time of writing. The contract slid 0.7% to $97.37 a barrel on Tuesday, the lowest close since August 7.
While the European benchmark Brent crude for September settlement traded 0.32% lower to $102.56 a barrel on the ICE Futures Europe exchange based in London at the time of writing. The European benchmark fell to its lowest since July, 2013.
Crude supplies
The EIA cut its 2014 price forecast for the American West Texas Intermediate (WTI) after the US reached its highest monthly production in 27 years in July. Futures will reach an average $100.45 a barrel this year versus the July projection of $100.98, the agency said yesterday in its monthly Short-Term Energy Outlook. Crude output was 8.5 million barrels a day in July, the highest since April 1987, according to the EIA.
As the market awaits fresh crude inventories report from the EIA, the market is expecting to see a drop in oil supplies by 1.75 barrels last week. Gasoline supplies are expected to show a fall by 1.5 million barrels and distillate inventories probably increased by 200,000 barrels.
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Last week, US crude inventories rose by 229,000 barrels, while gasoline supplies increased by 2.7 million barrels during the week ending august 8, according to reports from the American Petroleum Institute (API).
Crude output from the Organization of the Petroleum Exporting Countries (OPEC) rose by 300,000 barrels a day to 30.44 million in July, the highest in five months, with gains from Saudi Arabia, according to the IEA’s monthly oil market report.
Libya is increasing their drilling rings as the country exported the first oil cargo from its Ras Lanuf port since it was shut by rebels last year, according to Libya’s National Oil Co’s spokesman, Mohamed Al Elharari.
China
Meanwhile, the industrial production in China; the second-biggest oil consumer, came in at an annualized 9% in July, compared with forecasts of a 9.2% growth rate, according to data from the National Bureau of Statistics (NBS).
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