UPDATE 3-Oil prices near seven-month lows on global oversupply
* OPEC supply jumps in May as Libya, Nigeria output recover
* Analysts say rising U.S. production has fed global glut
* Saudi minister confident OPEC supply cuts are working
(Updates throughout, changes dateline, previous TOKYO)
By Christopher JohnsonLONDON, June 20 (Reuters) - Oil prices steadied just above
seven-month lows on Tuesday after news of increases in supply, a
trend which has undermined attempts by OPEC and other producers
to support the market through reduced output.
Benchmark Brent <LCOc1> was up 15 cents at $47.06 by 0820
GMT. On Monday, it fell 46 cents, or 1 percent, to settle at
$46.91 a barrel.
That was its lowest close since Nov. 29, the day before the
Organization of the Petroleum Exporting Countries and other
producers agreed to cut output by 1.8 million barrels per day
(bpd) for six months from January.
U.S. crude oil <CLc1> was 15 cents higher at $44.35 a
barrel. It fell 54 cents on Monday to $44.20, its lowest close
since Nov. 14.
Both benchmarks are down by around 15 percent since late
May, when OPEC, Russia and other producers extended their limits
on production until the end of March 2018.
"Recent data points are not encouraging," Morgan Stanley
analysts said in a research note. "Identifiable oil inventories
- both crude and product in the OECD, China and selected other
non-OECD countries - increased at a rate of (about) 1 (million
bpd) in Q1."
OPEC supplies jumped in May as output recovered in Libya and
Nigeria, two countries exempt from the production reduction
Libya's oil production rose more than 50,000 bpd to 885,000
bpd after the state oil company settled a dispute with Germany'sWintershall, a Libyan source told Reuters. [nL8N1JG287]
Nigerian oil supply is also rising, industry figures show.
Exports of Nigeria's benchmark Bonny Light crude oil are set
to reach 226,000 bpd in August, up from 164,000 bpd in July,
loading programmes show. [nL8N1JG4PX]
"The increasing August export programme in Nigeria and the
jump in Libyan oil output should pressure oil prices further in
the short term," said Tamas Varga, senior analyst at London
brokerage PVM Oil Associates.
"If we get bearish U.S. oil statistics this week, we could
see a test of $45 on Brent," Varga said.
U.S. oil production has been rising quickly this year,
feeding the global glut. Data on Friday showed a record 22nd
consecutive week of increases in U.S. oil drilling rigs. [RIG/U]
But Saudi Energy Minister Khalid al-Falih said the oil
market is heading in the right direction and just needs time to
rebalance, the London-based newspaper Asharq al-Awsat reported
on Monday. [nL8N1JG0OQ]
GRAPHIC: Brent oil may bottom out around $46.20 http://tmsnrt.rs/2tm5Z62
GRAPHIC: U.S. oil neutral in $44.10-$44.55 range http://tmsnrt.rs/2rPhW2f
(Additional reporting by Aaron Sheldrick in Tokyo; editing by
((firstname.lastname@example.org; +44 7790 561
Keywords: GLOBAL OIL/ (UPDATE 3)