OPEC crude output up by over 40,000 b/d

OPEC crude output up by over 40,000 b/d

OPEC crude output up by over 40,000 b/d

The Saudis themselves reported total production of 10.288 million barrels a day in August, down by about 201,000 compared to July.

But analysts predict Iran could still see its oil sales drop by around 700,000 barrels per day from their current level of around 2.3 million.

Despite the positive expectations, activity was muted Tuesday as market focus remained on OPEC's monthly report on oil fundamentals, which forecast global demand for OPEC's crude at 33.40 million b/d for both the third and fourth quarters.

June's OPEC meeting ended with a commitment for just under 1 million b/d of increased output, supported by Saudi Arabia and Russian Federation. In June the Saudis raised production by more than 400,000 barrels a day, and the August cutbacks follow a July agreement between the cartel and its partners, including Russian Federation, to increase production.

OPEC's July output is 270,000 bpd more than OPEC expects the demand for its oil to average next year, suggesting a small surplus in the market should OPEC keep pumping the same amount and other things remain equal.

In addition, OPEC reduced its projection for global oil demand growth for this year by 20,000 to 1.64 million bpd, while lowering the forecast for the next year by 20,000 to 1.43 million bpd.

In 2019, crude demand is expected to grow globally to a record 100.26 Mmbdp.

Global demand growth for 2018 was forecast at 1.64 million barrels a day, down by 10,000 from the prior month's estimate.

US production growth in 2018 is now expected to rise by 1.69 million barrels a day, down by 10,000 from last month's forecast. Crude inventories C-STK-T-EIA increased by 6.8 million barrels, representing the largest weekly rise since March a year ago. Crude stocks at the Cushing, Oklahoma USOICC=ECI, delivery hub for USA crude futures rose 1.6 million barrels.

Iran's oil exports peaked at nearly 3 million bpd in May this year, but they have since fallen to around 2 million bpd as Asian buyers, including Japan, South Korea and India, began to shun its crude ahead of the sanctions. Brent crude for October delivery traded up about 0.1% at $72.71.

Crude prices were lower Monday morning, with West Texas Intermediate for September delivery trading down about 0.4% at $67.33.

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