Tuesday, August 11, 2015

Brent crude oil price falls 1.7 per cent as Opec output reaches three year high

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Crude oil production by members of the Organisation of Petroleum Exporting Countries (Opec) reached its highest in three years in July, despite Saudi Arabia indicating it had pulled back, figures published today showed. Brent crude oil is trading 1.7 per cent lower.

Opec's monthly oil market report suggested total output among member countries rose 100,700 barrels per day to 31.5m.

The increase was driven partly by Iran, which increased oil output to 2.86m barrels per day, its highest level since June 2012. That figure was up from 2.83m in June. International sanctions against Iran started in July 2012.

But Saudi Arabia, Opec’s largest oil producer, said it had reduced production to 10.36m barrels per day in July, down from 10.56m in June.

Global demand for Opec crude oil is projected to increase by 900,000 to an average of 30.1m barrels per day in 2016, the report said. That's up from 29.2m in 2015.

Oil prices fell below $50 per barrel last week, hitting a new six month low, due to a resurgence of US production and rising Opec output. Signals of a boost in demand in Asia weren't enough to raise prices significantly.

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