Oil rises on Qatar rift, sterling steadies after London attack

"The market just has to be patient", said Bjarne Schieldrop, chief commodities analyst at SEB Markets, adding that a gradual reduction in inventories would support prices without the kind of price spike that would drive USA shale production higher.

USA stocks of crude oil and gasoline surprisingly rose last week as refinery runs declined and exports fell, the Energy Information Administration said on Wednesday.

The U.S. Energy Information Administration releases official figures midway through the morning session and the results may offset some of the geopolitical factors at play in early trading. The 1.8 million barrel a day reduction was enacted to drive the price of oil up and make the industry more profitable to OPEC producers.

Oil traded little changed as diplomatic efforts to resolve a clash between Qatar and Saudi Arabia played out, with crude supplies seen as unaffected.Futures slipped as much as 1% in NY.

USA crude oil inventories rose unexpectedly last week amid lower refinery runs and exports. API also reported gasoline supplies increased by 4.1 million barrels and distillate inventories increased by 1.8 million barrels.

The bearish report represents the first crude inventory build in several weeks and lends credit to recent sentiment over USA shale production rising at a pace that could in part offset a production cut from the Organization of the Petroleum Exporting Countries.

According to traders Brent crude oil futures were at $50.21 per barrel on Monday - an increase of 26 cents, or 0.5 percent.

"EIA also stated that United States production can touch a record ten million bpd next year from the current output of 9.3 million".

Crude prices, in addition, continued to remain under pressure after several Saudi-led Gulf states cut diplomatic ties with Qatar on Monday claiming national security concerns.

"The relentless increase in USA oil production appears to have the market anxious that the OPEC cuts will be completely nullified by the increased U.S. production", said William O'Loughlin, analyst at Rivkin Securities. He pointed to high levels of crude production in the USA, the North Sea and the potential for rising output from Libya and Nigeria.

NEW YORK, June 5 (Reuters) - Wall Street stocks dipped on Monday, weighed down by Apple, as world equity markets fell with oil prices, while the US dollar recovered from a near seven-month low against the euro.

The agency now sees WTI averaging $53.61 a barrel next year, down 2.7 percent from a forecast of $55.10 in last month's short-term energy outlook.

USA crude futures tumbled 5 percent, or $2.47 a barrel, to $45.72 a barrel, the lowest settlement for US crude since May 4.

  • Zachary Reyes