Oil Steady on Libya Halt as Saudis Promise a Smooth End to Curbs

Futures in New York were little changed, after rising 3 percent the previous two sessions. Libya’s crude loadings from the Mellitah terminal will be “modified” after protests impeded output at the El-Feel field. Cuts by OPEC and its allies may be phased out in 2019 in a way that won’t disturb the market, Saudi oil minister Khalid Al-Falih said. Still, U.S. supply remains a threat, with the nation’s rig count rising for a fifth week to the highest since April 2015.

Oil has risen more than 5 percent this year, following a second annual gain, as a drain in U.S. stockpiles and growing demand reassure investors that production cuts led by the Organization of Petroleum Exporting Countries are working. While America continues to pump record volumes, accompanied by an increase in exports, Al-Falih said the global oil market is re-balancing and bloated inventories are shrinking.

Crude loadings at Melittah, the export terminal for El-Feel, will be slowed after force majeure was declared on deliveries from the deposit on Feb. 23 following protests over pay and other benefits, the state-run National Oil Corp. said in a document obtained by Bloomberg. Libya is an OPEC member that was allowed to increase production, exempt from the group’s effort to reduce output to eliminate a global glut.

“Investors are likely looking at Libya for a potential reason for a rally in oil prices, but this shouldn’t last too long,” Barnabas Gan, an economist at Oversea-Chinese Banking Corp., said by phone from Singapore. “Global oil fundamentals have been improving ever since OPEC and its allies agreed for production cuts, and the demand story is still supporting prices.”
more at:  https://www.bloomberg.com/news/articles/2018-02-25/oil-halts-gains-as-saudis-see-crude-output-cuts-easing-in-2019