Oil prices down on background of increased oil shale production in U.S.
By Sara Israfilbayova
Oil prices went down on Thursday afternoon after the December report of the International Energy Agency (IEA).
Brent crude futures were at $62.19 a barrel, down 0.38 percent, while U.S. West Texas Intermediate (WTI) futures down 0.34 percent to $56.41 a barrel, according to RIA Novosti.
The IEA points out that, according to the U.S. Energy Department, in September, oil production in the country increased by 290,000 barrels per day in month terms, to 9.48 million barrels a day - to the highest monthly rate since April 2015. Now experts do not rule out that in December oil production in the U.S. will continue to grow.
An additional factor for the decline in oil prices was the increase in oil production in the U.S. to record values. Over the past week, oil production in the U.S. increased by 73,000 barrels per day to 9.78 million barrels per day.
The production of oil in the U.S. is approaching the indicators of Russia and Saudi Arabia.
The production report in the U.S. issued after the publication of the monthly OPEC report, which showed that oil production in the OPEC countries in November fell by 133,000 barrels per day to 32.5 million per day.
The rumors that the OPEC and non-OPEC countries led by Russia could discuss the extension of the agreement on production reduction after 2018 was a factor in support of oil prices.
Investors also take into account the surprisingly weak value of industrial production in China. However, high refining rates helped to neutralize the effect of increasing production.
Moreover, OPEC compliance with agreed cuts rose to 115 percent, the highest this year, and lifted the 2017 average to 91 percent.
The EIA reported that OPEC crude supply fell in November for the fourth consecutive month to 32.36 million barrels per day (mb/d), down 1.3 mb/d on a year ago.
Crude oil output increased mainly in Nigeria, while production mainly declined in Angola, Saudi Arabia, Venezuela and UAE, according to the report.
OPEC and a number of non-member countries agreed at the end of 2016 in Vienna to reduce their oil production by a total of 1.8 million barrels per day, of which 300,000 barrels fall on Russia.
The agreement was concluded for the first half of 2017, and then extended until the end of March 2018. In November, OPEC+ countries again decided to extend the Vienna deal, this time until the end of 2018.
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