Oil prices up slightly on pipeline outage support


The West Texas Intermediate for January Delivery added 0.44 dollar to settle at 57.04 dollars a barrel on the New York Mercantile Exchange, while Brent crude for February delivery gained 0.87 dollar to close at 63.31 dollars a barrel on the London ICE Futures Exchange. It had settled down $1.35, or 2.1% on Tuesday on a wave of profit-taking after news of a key North Sea pipeline shutdown helped send the global benchmark above $65 for the.

Oil prices wavered between gains and losses on Thursday, as traders weighed higher oil output against a major pipeline outage. It's expected to be down several weeks.

Britain's Forties oil pipeline, the country's largest at a capacity of 450,000 barrels per day (bpd), shut down on Monday after cracks were revealed.

The outage's main physical impact is the North Sea region, but it has global relevance as the crude is used to underpin the Brent price benchmark.

A number of producers, including BP and Royal Dutch Shell, said they had closed down oil fields in response.

"The market reaction shows that in a tight market, any supply issue will quickly be reflected in higher prices", said ANZ bank.

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Bill O'Grady, chief market strategist at Confluence Investment, summarized the situation succinctly: "You've got a mixed bag of data, frankly", and he added that while USA crude inventories have been declining over the past four weeks, "you are seeing this really impressive build in gasoline". "Now, we're basically where we were a month ago", Olivier Jakob of Petromatrix consultancy said.

"Commercial oil stocks in the OECD fell further in the month of November and the difference to the latest five-year average has been reduced by around 200 million barrels since the beginning of this year", Barkindo said at an energy forum in China on Wednesday. That is nearly twice the decline of analysts' expectations for a drop of 3.8 million barrels.

The U.S. government's Energy Information Administration releases its weekly oil report on Wednesday.

"World oil demand growth is estimated to have reached 1.53 million barrels a day in 2017, well above the initial forecast and maintaining the consistently healthy growth seen over the last three years".

With cash pouring into the USA shale oil industry, the United States is on track to deliver up to 80 percent of the world's oil production gains through 2025, the IEA estimates.