Oil prices dipped on Thursday, weighed down by swelling US crude inventories and record weekly US production which is countering efforts by producer cartel OPEC to cut supplies and prop up prices.
Brent crude oil futures LCOc1 were at $73.21 per barrel at 0150 GMT, down 15 cents, or 0.2 per cent, from their last close.
US West Texas Intermediate (WTI) crude futures were down 8 cents, or 0.1 per cent, at $67.85 per barrel.
Prices were pulled down by a report from the US Energy Information Administration (EIA) on Wednesday showing US crude inventories jumped by 6.2 million barrels to 435.96 million barrels C-STK-T-EIA in the week to April 27, marking a 2018 high.
“The (EIA) report showed a much larger than expected crude build for last week as well as an unexpected build in gasoline inventories,” said William O’Loughlin, investment analyst at Australia’s Rivkin Securities.
US oil production also hit a fresh record of 10.62 million barrels per day (bpd), a jump of more than a quarter since mid-2016.
The United States now produces more crude oil than top exporter and OPEC-kingpin Saudi Arabia, according to Reuters.
Only Russia currently pumps more oil, at around 11 million bpd.
O’Loughlin said that relatively high oil prices, supported by healthy demand and production cuts by the Organization of the Petroleum Exporting Countries (OPEC) to tighten markets, “are encouraging US shale producers to continue ramping up production.”
OPEC produced around 32 million bpd of crude oil in April, according to a Reuters survey, implying that its production is slightly below its target of 32.5 million bpd, due largely to plunging output in Venezuela.
BMI Research said it expects OPEC’s output to remain stable around or slightly above 32 million bpd for the rest of the year.