Brent crude slips below $67 but remains at two-year high

Oil prices eased on Wednesday from the two-and-a-half year highs they reached in the previous session, with Brent crude falling below the $67-mark it crossed yesterday.

The crude futures, however, remain upbeat as markets continue to tighten driven by OPEC-led output cut deal. More recently, a supply disruption of an estimated 90,000 barrels per day (bpd) in Libya due to an explosion in crude pipeline and an outage in Britain’s Forties pipeline have added support to investor confidence.

The international benchmark Brent crude was last down 0.5 percent at $66.67 per barrel (bbl), while West Texas Intermediate (WTI) crude slipped 0.4 percent to $59.73/bbl – down from $60-level in the previous session.

Meanwhile, the Forties pipeline, which was closed earlier this month after cracks were found in it, has been repaired and is being tested, operator Ineos was quoted as saying by Reuters. The 450,000 bpd pipeline is expected to resume services early next month.

“While the OPEC/non-OPEC production cut agreement has been extended to end-2018, attention is already being paid to the group’s strategy towards the end of the deal,” National Bank of Kuwait said in a recent report.

“But there are upside risks for 2018, too: given strong demand growth, Goldman Sachs, for example, sees the oil market rebalancing as soon as mid-year, paving the way for an earlier-than-scheduled end to current supply cuts,” it added.

Write to Nadeshda Zareen at nadeshda.zareen@argaamplus.com