On the final day of trading and for the first time since 2015, U.S. oil was at $60 a barrel, a 12 percent gain.
Declining global inventories and a strong demand from China saw Brent crude futures gain 17 percent. This was supported by the cuts made by OPEC and non-OPEC members together with Russia. Meanwhile output in the U.S. grew.
Decline in Worldwide Oil Inventories
President of Lipow Oil Associates in Houston, Andrew Lipow said that the decline in worldwide oil inventories is most likely to continue into 2018 and US crude prices by the end of the year will creep to around $63 a barrel. He expects that with the rise in U.S. oil exports Brent will be in the region of $67 a barrel.
U.S. West Texas Intermediate crude futures closed at the highest since June 2015 at $60.42.
Brent crude futures broke through $67 a barrel during the week and was up 45 cents at $66.62 a barrel.
Data released by the U.S. Energy Information Administration on Thursday showed that there was a decline in domestic oil production from the previous week of 9.79 million bpd to 9.75 million barrels per day.
Data released by the EIA on Friday indicated that crude production in the U.S. was at a 46 year high for October, whilst demand rose for oil exports. Data also indicated that U.S. output grew almost 16 percent since the middle of 2016. In the next few weeks analysts expect U.S. oil output to grow to 10 million barrels per day and to continue. This will hamper the efforts of other producers to cap global supplies. RBC Capital Market analysts reportedly said that they had redrawn the global crude map as U.S. shale is impacting and encroaching on uncharted territory.
U.S. commercial crude storage levels dropped 4.6 million barrels for the week according to the EIA report, a 20 percent decline in inventories.
Disruptions in Libya
According to a Libyan oil official, Libya is expecting to resume production this coming week-end after repairing the Es Sider terminal pipeline. The Forties pipeline is pumping close to normal levels after it was opened earlier this month.
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