NEW YORK (Reuters) – Oil prices fell on Friday due to concerns over the increase in US production and falling demand in China, which weighed on the contract and JP Morgan cut its forecast of prices.
Brent LCOc1 crude futures were down 86 cents, or 1.1 percent, to $ 76.46 on barrel. Crude oil futures West Texas Intermediate (WTI) closed at 21 cents at US $ 65.74 per barrel. During the week, Brent fell 0.5 percent, while US crude fell 0.3 percent.
In the last three weeks, prices have decreased from maximum three years, since the market has had supply problems. On Friday, oil prices were under pressure after data suggested that Chinese demand was declining and concerns persisted about the growth of US production.
Hedge funds and other money managers reduced their bullish bets on US crude futures in the week ending June 5, said the Commodity Futures Trading Commission (CFTC) of the United States.
JP Morgan cut its 2018 crude forecast for WTI by $ 3 to $ 62.20 per barrel. The bank said that geopolitical tensions and persistent risks of supply disruptions can push prices higher during the second half of 2018, expect prices to fall by the end of the year and remain limited in 2019.
futures fell after the forecast was issued, and then reduced losses.
China's oil imports in May moved away from the record reached the previous month, according to customs data, and state refineries entered planned maintenance.
May shipments were 39.05 million tons, or 9.2 million barrels per day (bpd). That compared to 9.6 million bpd in April.
Weighing more in prices has been increasing the production of EE. UU C-OUT-T-EIA, which hit another record last week at 10.8 million bpd.
U.S. drillers added an oil rig in the week until June 8, bringing the total count to 862, the highest level since March 2015, energy utility Baker Hughes of General Electric Co said in its report. RIG-OL-USA-BHI [RIG/U]
The increase in the production of EE. UU It has reduced WTI by a discount against Brent CL-LCO1 = R of more than $ 11 per barrel, its highest level since 2015.
STILL FIXED MARKET
Despite Friday's decline, Brent remains more than 15 percent above its level at the beginning of the year.
U.S. Investment bank Jefferies said the crude market is tight and that surplus capacity could be reduced to 2 percent of demand in the second half of 2018, its lowest level since at least 1984.
Markets have been seen affected by supply problems in Venezuela, where PDVSA's oil company is struggling to clear a backlog of around 24 million barrels of crude waiting to be sent to customers.
More generally, Brent was driven by the voluntary production cuts that were launched last year, led by the Organization of Petroleum Exporting Countries (OPEC) and Russia.
OPEC and Russia meet on June 22 and 23 to discuss production policy.
On Friday, Iran's third largest producer, OPEC, criticized the US request that Saudi Arabia pump more oil to cover a drop in Iranian exports and predicted that OPEC will not heed the appeal.
Holders of OPEC members' plans for the meeting later this month will lead to volatile swings in the market, said Tariq Zahir, an administrative member of Tyche Capital Advisors in New York.
"I think it's going to be very hectic," he said.
Additional reporting by Shadia Nasralla and Dmitry Zhdannikov in London, Henning Gloystein in Singapore; Edition by Marguerita Choy and Phil Berlowitz