Production Caps for Libya, Nigeria Under Consideration

Oil under pressure from OPEC, US output

West Texas Intermediate crude, the US benchmark, fell 2.6 percent to $44.32 a barrel as of 7:58 a.m.in NY on Friday. Brent crude, which is a benchmark, was down by 15 cents a barrel and USA crude CLc1 was also down by 15 cents.

The industry needs to see sustained inventory draws and U.S. rig count declines or evidence of further Opec cuts for prices to rally, and Goldman said a failure to do so means WTI oil prices could fall below $40 per barrel.

The expected rise in oil demand in coming weeks has pushed the prices up, Reuters reported citing traders.

The U.S. West Texas Intermediate crude August contract rose 0.43% to $44.59 a barrel on Tuesday.

Since OPEC members and participating non-OPEC countries concluded an agreement in May to continue the supply reduction deal of 1.76 million barrels per day for another nine months until March 2018, the price of oil has declined more than 15 percent.

However, caution is warranted in light of growing production from Libya and Nigeria, the two OPEC members exempt from the cartel's output cut agreement. The global benchmark crude traded at a premium of $2.31 to September WTI. According to the publication, Nigeria and Libya have been invited to the meeting of the Joint OPEC-Non-OPEC Ministerial Monitoring Committee on July 24 in St. Petersburg.

According to Bloomberg, Mr Almarzooq disclosed on the sidelines of an energy conference in Istanbul, Turkey, that the two African nations may be asked to cap their crude output.

Nigeria's finance minister met last week with OPEC Secretary General Mohammad Barkindo. French BNP Paribas revised its Brent average forecast for this year by US$9 to US$51 a barrel, seeing WTI at US$49, down US$8 from its earlier forecast.

Both Nigeria and Libya were given exemptions to the supply cut, under which OPEC, Russia and other non-OPEC producers are reducing their output by about 1.8 million barrels per day because their output has been curbed by conflict.

Barclays bank also reduced its Brent forecasts for this year from $55 to $52 and from $57 to $52 next year.

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