Crude Oil Soars Above USD63 For 3-Year High


U.S. West Texas Intermediate crude (WTI) gained 36 cents to $62.09 and reached its highest since May 2015 as well at $62.56.

Brent crude futures fell 45 cents, to $67.62 a barrel.

Analysts say United States output may have levelled off over the holidays.

Oil's price rally this year to its highest since May 2015 may seem a source of glee for OPEC, but some in the producer group fear the gains could prompt shale companies to crank open their spigots and flood the market.

The American Petroleum Institute reports its weekly inventories numbers this afternoon, followed by the government's official report tomorrow morning.

A simmering power struggle in Iran has raised anxieties over the stability of Organization of Petroleum Exporting Countries' (Opec) third-largest crude producer.

OPEC has no formal target for oil prices.

This week's supply reports from the American Petroleum Institute and the USA government's Energy Information Administration are predicted to reveal that us crude stocks dropped by 4.1 million barrels, an eighth week of decline.

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"We expect oil demand growth to outpace non-OPEC supply growth in both 2018 and 2019", Standard Chartered analysts said in a note.

Crude oil futures continued to surge Tuesday on expectations the global oil market will soon re-balance.

The report also noted that the North Sea Brent barrel stands at $64 per barrel, which is the highest it has been since November 2014, the start of the oil price crisis.

Some analysts have said a rise in USA shale oil production could discourage OPEC and Russian Federation to maintain their deal to curb supply until the end of the year for fears of losing market share.

Even so, USA production is expected soon to rise above 10 million barrels per day, close to Saudi levels, due largely to soaring output from shale drillers, government data shows.

However, Innes added that Middle East turmoil would remain a key focus for oil markets and had the potential to "send oil prices rocketing higher".

US crude production was forecast to climb by 970,000 barrels per day (bpd) in 2018 and rise another 580,000 bpd to 10.85 million bpd in 2019, the EIA said in a monthly report that provided the agency's first outlook for next year.