Oil prices steadied yesterday following steep falls earlier in the week, pressured by widespread evidence of a fuel glut despite efforts led by the Organization of the Petroleum Exporting Countries (OPEC) to tighten the market.
Brent crude oil LCOc1 was up 10 cents at $47.96 a barrel by 0920 GMT, around 12 percent below its opening level on May 25, when an OPEC promise to restrict production was extended into 2018. U.S. crude CLc1 was 10 cents higher at $45.74.
OPEC and other big producers have agreed to pump almost 1.8 million barrels per day (bpd) less than they supplied at the end of last year, and hold output there until the first quarter of 2018. But world markets are still awash with oil.
“The challenge OPEC is facing is bigger than anyone thought a few weeks ago,” said Tamas Varga, analyst at London brokerage PVM Oil Associates. U.S. data this week showed a surprise 3.3-million-barrel build in commercial crude oil stocks to 513.2 million. Inventories of refined products were also up, despite the start of the peak-demand summer season.
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