UPDATE 7-Oil eases as weak demand tempers bullish Saudi energy minister comments

Published 2016-07-04, 04:34 p/m
© Reuters.  UPDATE 7-Oil eases as weak demand tempers bullish Saudi energy minister comments
MS
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LCO
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CL
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* Saudis, OPEC say oil market heading into balance
* But analysts warn that slowing refineries will cut crude
orders
* Tankers wait outside NY Harbor, gasoline tankers diverted

(Updates settlement prices)
By Ahmad Ghaddar and Catherine Ngai
LONDON/CALGARY, July 4 (Reuters) - Global oil prices eased
on Monday after comments by Saudi Energy Minister Khaled
Al-Faleh that the market was heading towards balance were
tempered by slowing demand in Asia, pockets of gasoline
oversupply and signs crude output could rise.
Brent crude futures LCOc1 settled down 25 cents to $50.10
per barrel. U.S. crude futures CLc1 were trading down 23 cents
at $48.76 per barrel.
U.S. markets are closed on Monday for the U.S. Independence
Day holiday, so trading remained thin on the day.
The energy minister of Saudi Arabia, the world's top crude
exporter, and the secretary general of producer club OPEC agreed
that global oil markets were heading towards balance, and that
prices reflected this.
However, analysts at Morgan Stanley (NYSE:MS) said there were also
signs prices could fall again soon, pointing at stalling
gasoline demand and more oil from Canada and Nigeria after
production problems.
In the New York Harbor, at least two tankers carrying
gasoline-making components have dropped anchor, unable to
discharge their cargo. Several tanks with gasoline also have
been diverted, underscoring the latest oversupply issue

Meanwhile, the Nigerian National Petroleum Corporation said
last week that output was rising following repairs after attacks
in the Niger Delta that had pushed crude output to 30-year lows.

A deal to unify Libya's rival national oil corporations
could pave the way for the OPEC member to boost output which
currently stands at less than a quarter of pre-2011 levels of
1.6 million barrels per day (bpd).
"If the deal materialises it will have a real and
considerable impact on the oil market balance for 2017,
potentially cancelling out any projected deficit," SEB Markets
chief analyst for commodities Bjarne Schieldrop said.
Oil demand and, as a result, prices, could come under
pressure as weak refining margins prompt run cuts at a time when
plants in Asia are already gearing up for seasonal maintenance
work.
"Asia refiners have already started to pull back ... and
there are reports of cargoes struggling to sell," Morgan Stanley
analysts said on Monday.
Russian oil output in June rose slightly from the previous
month to 10.84 million bpd.
In Norway, oil workers signed a deal on Saturday, avoiding a
strike in western Europe's top producer.

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