Oil steady as emerging market woes dim demand outlook


Oil production from the Organisation of Petroleum Exporting Countries (OPEC) rose in July, despite supply shortfalls from Libya, Iran and Saudi Arabia.

A pump jack operates at a well site leased by Devon Energy Production Company near Guthrie, Oklahoma September 15, 2015.

Fears that the escalating tensions could lead to a slowdown in global economic growth and a corresponding hit to demand for oil have weighed on crude prices in recent weeks.

Brent crude futures for October delivery rose 74 cents to $73.35 a barrel by 11:00 a.m. (1500 GMT) U.S. West Texas Intermediate (WTI) crude futures rose 70 cents to $67.90 a barrel.

Oil prices edged lower on Tuesday, weighed down by a strengthening USA dollar as investors remained concerned about the financial crisis in Turkey. US stock indexes broadly gained, supporting oil futures.

"The equities and the USA dollar are keying primarily off of the unfolding saga in Turkey and although the lira has posted a significant rebound today, the standoff between Turkey and the U.S.is showing no sign of progress", Jim Ritterbusch, president of Ritterbusch and Associates, said in a note.

Iran is selling oil and gas at a discount to Asian customers as it prepares for the return of U.S. sanctions, state news agency IRNA reported on Tuesday.

As for Saudi Arabia, OPEC's largest oil producer submitted to the group its own data which showed that output slipped by 200,000 to 10.28 million bpd in July.

At the same time, OPEC lowered its global oil-demand growth estimate by 20,000 bpd, to 1.64 million bpd this year. Rising output from Nigeria, Kuwait and the UAE offset the drops.

The data released by the American Petroleum Institute on Tuesday showed that crude inventories rose by 3.7 million barrels in the week to August 10 to 410.8 million, compared with analysts' expectations for a decrease of 2.5 million barrels.

"Discount is part of the nature of the global markets being offered by all oil exporters", the source told IRNA.

However, some analysts say trade disputes between the United States and China and turmoil in emerging markets could curb energy demand. Those figures were mainly due to adjustments to production in China during the first half of the year.