Oil Swings Higher but Set for Worst First Half Performance Since 1997

23 June, 2017

Oil pushed its way up on Friday, managing to recover some of the sharp falls which occurred in the week, but oil is still predicted to have the worst first half decrease in 20 years regardless of continuing production cuts.

Brent crude futures LCOc1 were at $45.39 per barrel at 0501 GMT- 17 cents up from the last close.

US WTI crude futures CLc1 were up by 0.4% at $42.91 per bpd.

Oil prices have dropped around 20% this year regardless of efforts led by OPEC to decrease production by 1.8 mil barrels per day that was set in place since January.

This crude oil performance is the worst first half since 1997, when an increase in output in combination with the financial crisis in Asia led to long price falls.

The OPEC’s inability to rein in fuel supply extension has resulted in the weak markets. "Markets remain skeptical of OPEC's ability to balance supplies," ANZ bank said on Friday.

The most recent efforts to decrease production of oil from the standard suppliers of Russia and OPEC have been hindered by the excess output from the US.

Largely due to shale drillers in the US, oil production C-OUT-T-EIA has grown by more than 10% over the last year to 9.35 mil. Bpd, almost meeting the level of Saudi Arabia, the world’s top exporter of oil.

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