Crude Oil Plunges Near USD50 As Gasoline Stockpiles Rise

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Oil prices dipped on Wednesday as bloated USA supplies weighed on markets while a fall in Saudi crude exports was offset by rising production in the country.

Crude oil inventories fell by 1 million barrels, the second weekly decline in a row, according to EIA data.

USA crude inventories, however, fell by 1.0 million barrels last week to 532.3 million barrels, said the EIA.

Moscow has not stated whether it supports prolonging the curbs, although Energy Minister Alexander Novak said this month that Russian Federation would soon start consultations with its own oil producers about the possibility of doing so.

The dollar index, which tracks the greenback against six major peers, was up 0.23 percent at 99.731 in late trading on Wednesday.

US crude futures fell 38 cents, or 0.73%, to $52.03 a barrel on the New York Mercantile Exchange.

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The market received a modicum of support from comments on Wednesday by Mohammed Barkindo, secretary-general of the Organization of the Petroleum Exporting Countries, that the group was committed to cutting inventories.

In London, June Brent crude LCOM7, -3.75% on the ICE exchange shed 16 cents, or 0.3%, at $54.73 a barrel. USA crude inventories were at 532.3 million barrels, only about 3 million barrels less than the record reached in March.

"OPEC and Russian Federation would love to see the price higher but it requires a not yet achieved 100 percent non-OPEC compliance, combined with a slowdown in USA production growth", Hansen told UPI in response to emailed questions.

And OPEC, in the wake of its production-freeze agreement late a year ago, appears to be once again losing market share - the recapturing of which was the reason the oil sheiks engaged in their price war in 2014 in the first place.

OPEC and other producers such as Russian Federation agreed to cut output by almost 1.8 million barrels per day in the first half of 2017 to drain a supply overhang that has persisted for nearly three years. Also, U.S. production rose to 9.252 million barrels a day in the most recent week, highest since August 2015.

Saudi Arabia's oil exports fell to 6.96 million bpd in February from 7.7 million bpd in January.

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