MTECHTIPS;-Crude oil settles 2% lower as Opec output swells in July

MTECHTIPS;-Crude oil settles 2% lower as Opec output swells in July

MTECHTIPS-Crude futures settled lower on Thursday, as market participants questioned Opec’s commitment to the global pact to curb production in the wake of a report showing crude output among the group’s members rose in July. On the New York Mercantile Exchange crude futures for September delivery fell 2% to settle at $48.59 a barrel, while on London’s Intercontinental Exchange, Brent lost 1.16% to trade at $52.09 a barrel. In a monthly report Thursday, the Organization of the Petroleum Exporting Countries raised its outlook for oil demand this year by 100,000 barrels a day, saying it now expects growth of 1.37 million barrels a day in 2017. The cartel also said, however, that production from the group rose further in July, as exempt producers – Nigeria and Libya – and top exporter Saudi Arabia increased output. This Opec report stoked fears that Opec and its allies’ may not be able to stem the glut in supplies by only curbing production, offsetting optimism from the prior session, when crude prices snapped a two-day losing streak, following bullish U.S. inventory data. Inventories of U.S. crude fell by roughly 6.5 m barrels in the week ended Aug 4, confounding expectations of a draw of about only 2.5 m barrels, the Energy Information Administration reported Wednesday. It was the sixth-straight weekly decline.

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