Draw In Crude Inventories Lifts Oil Prices

Previous data from the industry body API as well as the official Energy Information Administration had shown a decline in U.S. crude stocks for two consecutive weeks to the end of September, helping support WTI prices, which have been lagging the upward momentum in Brent from growing optimism over a slow but steady rebalancing of the global oil market underway.

For 2018, it forecast WTI $50.57-up 2% from the previous outlook.

Brent crude futures, the global benchmark for oil prices, were down 78 cents, or 1.4%, at $56.16 late morning Thursday. Both benchmarks have risen more than 20 percent from their lows in June as world oil markets tightened.

On the other hand, OPEC said in its latest Monthly Oil Market Report it had revised upwards its 2017 oil demand growth forecast by 30,000 bpd to 1.5 million bpd, which also helped to strengthen prices despite the cartel also reporting an increase in its September oil production to 32.75 million barrels - 25,000 bpd above the quota OEPC agreed to last November.

Yesterday the EIA said it expects USA crude oil production in 2018 to rise by more than previously expected.

Meanwhile, traders also focused on oil inventory data. This likely means OPEC must deepen its production cuts to finish its job of bringing oil stocks back to the five-year average.

USA crude inventories are still 13 percent above five-year averages headed into the busy winter season, despite efforts by OPEC to cut production. S. inventories and a falloff in weekly production on Thursday.

Figures released by the Energy Information Administration showed USA commercial crude inventories fell by 2.8 million barrels to 462.2 million barrels in the week through October 6. For 2018, oil demand is expected to rise by 420,000 bpd vs 400,000 bpd previously.

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