[ 2016-11-11 ]

Oil prices dip
Oil prices fell in early trading on Friday, as the
market refocused on a persistent fuel supply
overhang that is not expected to abate unless OPEC
and other producers make a significant cut to
their output.

International Brent crude oil futures LCOc1 were
trading at $45.74 per barrel at 0445 GMT, down 10
cents, or 0.2 percent, from their last close.

U.S. West Texas Intermediate (WTI) crude oil
futures CLc1 were trading at $44.51 per barrel,
down 15 cents, or 0.3 percent, from their last
settlement, with a stronger dollar also weighing
on prices.

Traders said that an ongoing crude and refined
product supply overhang that has dogged markets
for over two years was weighing on markets.

"Crude oil prices fell as the focus returned to
supply growth. The IEA suggested prices may
continue to retreat amid relentless supply growth
unless OPEC makes significant supply cuts," ANZ
bank said on Friday.

The supply overhang could run into a third year in
2017 without an output cut from the Organization
of the Petroleum Exporting Countries (OPEC), while
escalating production from other exporters could
lead to relentless supply growth, the
International Energy Agency said on Thursday.

In its monthly oil market report, the group said
global supply rose by 800,000 barrels per day
(bpd) in October to 97.8 million bpd, led by
record OPEC output and rising production from
non-OPEC members such as Russia, Brazil, Canada
and Kazakhstan.

In Africa, Nigeria is working out new oil and gas
policies to attract more private investors and
boost crude production by 500,000 bpd by 2020,
state firm NNPC said on Thursday.

The IEA kept its demand growth forecast for 2016
at 1.2 million bpd and expects consumption to
increase at the same pace next year, having
gradually slowed from a five-year peak of 1.8
million bpd in 2015.

Beyond oversupply, a surging dollar .DXY following
the initial shock of Donald Trump's U.S.
presidential election win also put pressure on
prices, traders said.

Because oil and refined products are traded in
dollars, its import costs rise for any country
using other currencies at home, potentially
crimping demand.

Source - Reuters

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