A worker checks the valve of an oil pipe at the Lukoil company
owned Imilorskoye oil field outside the West Siberian city of
Kogalym, Russia, January 25, 2016.
Oil prices were down slightly on Thursday as the market
braced for U.S. government data likely to show the first crude
inventory build in six weeks, with record Chinese imports of
crude limiting losses.
Also weighing on the market was data from Wednesday
showing OPEC output at record highs despite the producer group's
pledges to cut production soon to rein in a global crude glut.
Brent crude LCOc1 was down 4 cents at $51.77 per
barrel by 9:16 a.m. EDT (1316 GMT), after dropping as much as 48
cents earlier.
U.S. West Texas Intermediate (WTI) crude shed 5
cents to $50.13. It fell 56 cents earlier at the session low.
The American Petroleum Institute (API), a trade
group, reported on Wednesday that U.S. crude inventories rose by
2.7 million barrels in the week to Oct. 7.
API's data indicated that the U.S. government's
Energy Information Administration (EIA) was also likely to
report a crude build for last week, the first in six weeks, in
data due at 11:00 a.m. EDT (1500 GMT). Analysts polled by
Reuters forecast that the EIA will cite a build of 300,000
barrels.
"I think the market is reacting appropriately"
awaiting the EIA data, said Scott Shelton, energy futures broker
with ICAP in Durham, North Carolina. "Crude builds can be
seasonal at this time of the year while products generally
draw."
China's September crude imports rose 18 percent from
a year earlier to 33.06 million tonnes, or 8.04 million barrels
per day (bpd) on daily basis, customs data showed, compared with
the U.S. four-week average of 7.98 million bpd.
The Organization of the Petroleum Exporting
Countries on Wednesday reported its oil production hit an
eight-year high of 33.39 million bpd in September.
It also raised its forecast for 2017 non-OPEC supply
growth, pointing to a larger surplus next year. OPEC's data runs
contrast to its pledge of the past two weeks that it intends to
cut some 700,000 bpd from an estimated global glut of 1.0-1.5
million bpd that forced oil prices down from mid-2014 highs
above $100 a barrel.
Major oil industry executives and investors at a
Reuters Summit in London differed in their views on the price
direction for oil in coming months based on OPEC's likely
action.
"In 2014, the big opportunity was in prices going
down and now the big opportunity is in prices going up. That's
the way I see it," said Pierre Andurand, manager of the $1.4
billion Andurand Capital fund in London, which has forecast $60
prices by the year-end.
(Additional reporting by Ahmad Ghaddar in LONDON and
Henning Gloystein in SINGAPORE; Editing by Elaine Hardcastle and
Bill Trott)
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