Crude edges above November lows
By Sara Israfilbayova
Crude prices settled more than half a percent higher on June 26 as some traders found bargains after last week's seven-month lows, but rising crude supply in the U.S. and other countries limited gains.
Global benchmark Brent settled up 0.6 percent, at $45.83 a barrel, U.S. West Texas Intermediate (WTI) crude futures were up 0.8 percent, at $43.38 a barrel, Reuters reported.
Oil has tumbled more than 20 percent from its peak, entering a bear market last week, on concerns that expanding global supply will undermine the impact of output cuts from the Organization of Petroleum Exporting Countries (OPEC) and partners including Russia.
U.S. crude drillers added rigs for a 23rd straight week, the longest stretch in three decades, according to data released by Baker Hughes Inc on June 23.
Traders and analysts said there was little fundamental news to justify more of a bounce in oil prices.
“It is just the fact that the oil market stopped falling … I suspect short-covering,” said Ric Spooner, chief market analyst at CMC Markets in Sydney.
Analysts at Bank of America-Merrill Lynch said that while supply was a problem, demand had not grown quickly enough to mop up any excess output.
“Looking into the second half of 2017, we now doubt that demand growth will accelerate sufficiently,” they wrote.
OPEC member countries and its partners have been trying to reduce a global crude glut with production cuts. OPEC states and 11 other exporters, such as Azerbaijan, Bahrain, Brunei, Kazakhstan, Malaysia, Mexico, Oman, the Russian Federation, Republic of Sudan, and the Republic of South Sudan agreed in May to extend cuts of 1.8 million barrels per day until March 2018.
However, Nigeria and Libya, OPEC members exempt from the cuts, have raised output. Iran was allowed a small increase to recover market share lost under Western sanctions. It said its production has surpassed 3.8 million barrels per day and is expected to reach 4 million barrels per day by March.
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