Oil prices held steady on Thursday, backed by a drop in crude inventories and a threat by militants to attack Nigeria’s oil sector and fields.
The biggest pressure on recent oil prices came from an increase in US fuel stocks. Brent crude futures fell slightly by about 4 cents, to trade at $69.34 a barrel. US crude futures “West Texas Intermediate” by 6 cents, trading at $64.03 a barrel.
Data from the National Petroleum Institute showed strong supply in the US markets for spent fuel products, which could mean a lower demand for crude oil in the upcoming future. Direct gasoline inventories rose to 1.8 million barrels, while inventories for distillates, including diesel and heating oil, increased to 609,000 barrels. US crude dropped by 5.1 million barrels in the week ending Jan 12th, and US crude inventories are estimated at 114.5 million barrels.
The Organization of Petroleum Exporting Countries (OPEC) has increased its forecast for oil supplies from non-OPEC members for 2018. At the same time encourages higher prices oil companies to pump more crude. The Organization of the Petroleum Exporting Countries said non-member producers would raise production by about 1.15 million barrels per day (bpd) for 2018, an increase by 990,000 bpd from the previous forecast. The Organization also hinted that high oil prices bring more supply to the market, especially in North America. Against these expectations, the indicators clearly showed that OPEC’s commitment to cut production remained high in January, and that Venezuela’s oil production fell significantly this month. OPEC’S commitment to production targets rose to 129%, more than the original 121% in November.
On a separate note, the largest US companies expected to increase US crude oil exports to 45% compared to a year ago, to reach 1.5 million barrels per day in 2018. The United States exported 1.037 million barrels per day on average last year until October, according to the latest data from Energy Information Management.