Crude oil prices reversed their slide on Friday after dropping below $67 a barrel on a United States inventory report showing that higher refinery production was helping boost gasoline and distillate inventories.
Light, sweet crude for October delivery gained 10 cents to $67,42 a barrel on the New York Mercantile Exchange by midday in Europe after earlier trading as low as $66,69.
October Brent crude on the ICE Futures Exchange was up 21 cents at $66,74 a barrel.
Supply worries have eased this week on the possibility that BP could restore lost Alaskan production at Prudhoe Bay by the end of October as well as hope for the resumption of some oil production in Nigeria.
US crude inventories fell by 2,2-million barrels last week to 330,6-million barrels, the US Department of Energy’s energy information administration said on Thursday. That was steeper than the 1,1-million-barrel decline that analysts surveyed by Dow Jones had expected. However, the inventories remain 6,2% above year-ago levels.
Gasoline inventories rose by 700 000 barrels to 206,9-million barrels, which is 6,6% above year-ago levels. Distillate fuel inventories rose by 3,1-million barrels to 139,9-million barrels — a bigger build than most analysts expected. They are now slightly above where they were a year ago.
Heating oil gained half a cent to $1,8925 a gallon (3,8 litres), while gasoline prices rose more than a cent to $1,6540 a gallon. Natural gas futures were steady at $5,722 per 1 000 cubic feet.
Supply issues will remain at the top of the agenda of next week’s meeting of the Organisation of the Petroleum Exporting Countries (Opec). Few in the market believe Opec will alter its current production targets.
BP officials testified to US lawmakers on Thursday about the company’s operational lapses in Alaska — a big oil spill in March and then the partial shutdown of the country’s largest oil field last month. Until the partial shutdown, Prudhoe Bay had been producing roughly 400 000 barrels per day, or 8% of total US output.
BP is currently pumping 220 000 barrels a day and Steve Marshall, the president of BP Exploration Alaska, said output could be fully restored as early as the end of October.
Additionally Royal Dutch Shell said on Thursday it was putting 180 000 barrels of crude per day back on line in Nigeria, according to Dow Jones Newswires. Shell had taken the oil supply off line on July 20 following a construction accident that damaged a key pipeline. Nigeria, Africa’s largest oil producer, has cut about a fifth of its usual production because of militant attacks. — Sapa-AP