OPEC and Russian Federation have also said they would cut oil production by 1.8 million barrels per day, as a supply glut continues and Iran prepares to boost its output. As of 2:00 p.m. EDT Tuesday, the government said that four refineries in the Gulf Coast were still closed because of issues associated with Harvey, representing about 4 percent of the total us refining capacity.
LONDON-Oil prices oscillated Monday morning, with USA crude recovering a fraction of its losses from the last session and Brent trending downwards.
The Saudi Arabian energy minister Khalid Al Falih agreed with his Venezuelan, Kazakh and UAE counterparts to keep all options open in their push to re-balance world oil markets, including the possible extension of output cuts beyond next March.
What's more interesting is that OPEC crude oil production, as estimated by secondary sources, declined by 79,000 barrels per day in August, for the first time in four months.
Investors anticipated a rise in US crude inventories ahead of official data due later on Wednesday.
At around $54 per barrel, the price for Brent crude oil, the global benchmark, is up almost $7 per barrel from June 30, but still below its peak of just over $56 per barrel for the year.
The OPEC's report also said the two hurricanes that had hit the United States would influence the demand side.
"Over the next two to three weeks, the EIA inventory numbers will be rather sloppy because you have production disrupted, refineries going offline and online", he said.
The supply cut helped boost crude prices above $58 a barrel in January, but prices have since slipped back to around $54, as the effort to clear a supply glut has taken longer than expected.
The deal agreed late past year to reduce output by about 1.8 million bpd until March 2018 helped to keep prices as high as $58 a barrel in January, but they have since sagged as global stocks have not fallen as quickly as expected.
Since the drop in Libya's oil production has persisted into September, I would not expect a significant rise in OPEC-14's crude oil production just yet. According to the EIA, the lower refinery demand for crude oil and limited ability to move crude oil resulted in crude oil inventory builds at Cushing, Oklahoma, and the Gulf Coast of 800,000 barrels and 1.7 million barrels respectively as of Friday, September 1.