"Nevertheless, growing prospects for an increase in production from the "OPEC Plus" and rising oil output from the USA will cap price gains".
Baker Hughes data showing that USA drillers added one oil rig in the week to June 8, bringing the total count to 862 (the highest level since March 2015), combined with reports that China's May crude oil imports eased away from a record high the previous month (from 9.6 million barrels per day to 9.2 million bpd), caused Brent to settle down 86 cents to $76.46 per barrel. U.S. West Texas Intermediate crude CLc1 rose 36 cents to settle at $66.07, its highest level since June 1. For the week, Brent fell 0.5 percent, while US crude slipped 0.3 percent.
"It's all about the JP Morgan report", said Bob Yawger, director of energy futures at Mizuho in NY.
JP Morgan cut its 2018 crude forecast for WTI by $3 to $62.20 a barrel. The bank did not immediately respond to a request for the report.
Beyond changes in supply, strong demand is supporting oil prices.
The number of new rigs drilling for oil in the United States rose by one last week to 862, its highest since March 2015, data from energy services firm Baker Hughes showed on Friday.
PDVSA has indicated to eight customers that it wouldn't be able to meet its commitment to deliver 1.5 million barrels a day in June, given that it only has 694,000 barrels a day to export, according to S&P Global Platts. Output dropped to 1.50 million bpd in April, the survey found, a new long-term low.
That suggests US output, already at a record 10.8 million bpd, will climb further.
Oil prices slipped on Monday, pulled down by rising Russian production and as USA drilling activity rose to its highest in more than three years.
Indeed, investment bank Jefferies reiterated that the market is tight and spare capacity could dwindle to 2 percent of demand in the second half of 2018, its lowest level since at least 1984 - but the warning went unnoticed, at least for the time being.
On Wednesday, crude prices received support in early trade on concerns about exports from Venezuela. An economic crisis in Venezuela is curtailing the country's oil production, while a planned reinstatement of USA sanctions against Iran also is expected to impede production from OPEC's third-largest member.
"We're going to be subject to incredible headline risk", said John Kilduff, a partner at Again Capital LLC, a New York-based hedge fund.
This story has not been edited by Firstpost staff and is generated by auto-feed.