Crude oil futures slip on rising inventory, record high output

Singapore — Crude oil futures fell during mid-morning trade in Asia Thursday as the Energy Information Administration reported higher crude stocks. Additionally, record high domestic output has also capped prices, analysts said. Receive daily email alerts, subscriber notes & personalize your experience. According to EIA data released Wednesday, US crude inventory rose by 1.26 million b/d to 447.21 million barrels, which was well under analysts’ expectations of a 3.7 million-barrel build in an S&P Global Platts survey of analysts conducted on Monday. Meanwhile, record high domestic output, coupled with slowing factory output in Germany also capped prices, analysts said. Despite this, market participants felt that prices would be higher on lower OPEC productions, US sanctions on Venezuela’s PDVSA and supply side issues. OPEC’s oil production fell to a near four-year low in January, according to an S&P Global Platts survey, as the cartel’s new output cuts designed to halt the price slide of late-2018 went into force. OPEC’s crude output plunged to 30.86 million b/d last month, a fall of 970,000 b/d from December, excluding flows from Qatar, which left the production group at the start of the year, the survey of industry officials, analysts and shipping data showed. The month-on-month fall was the biggest since December 2016 and the lowest OPEC output since March 2015, the survey found. In other news, US sanctions on PDVSA, Venezuela’s state-owned oil company, have already had a dramatic impact on global crude and diluent flows and is likely to hasten the already historic collapse of the South American nation’s oil sector. While the sanctions have yet to affect oil prices significantly, that could change if the crisis in Venezuela drags on, S&P Global Platts reported.