Oil prices stabilise after 6 percent drop since late April

Lagos State first oil derivation cash ready - Commissioner

Oil prices stabilized on Wednesday after falling for two straight days on concerns that slowing demand and rising Middle East production would extend a global supply overhang. Reuters reports.

International Brent crude futures were trading at $45.10 (31 pounds) per barrel at 0140 GMT, up 13 cents, or 0.3 percent, from their last settlement. Brent has fallen more than 6 percent since April 29.

U.S. West Texas Intermediate (WTI) futures were up 8 cents, or 0.2 percent, at $43.73 a barrel.

The slight price increases followed a more than 6 percent fall since the end of April that was triggered by rising output from the Middle East and renewed signs of economic slowdown in Asia.

Thanks to ongoing strong demand and further expectations of U.S. production cuts, BMI Research said on Wednesday that oil prices would likely rise in the short-term.

“We anticipate a strong pullback in non-OPEC supplies. We also expect some support from the U.S. (summer) driving season. Bloated crude stocks will thus unwind in the coming months,” BMI said.

“We believe prices will strengthen above $50 per barrel, trading in a range of $50-$60 per barrel until the end of the year,” it added.


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