Investing.com - Crude held weaker in Asia on Wednesday with a shakeup in the Saudi royal family shrugged off and after industry estimates on U.S. crude inventories painted a mixed picture with a larger than expected draw in oil stocks, but gasoline supplies up again and official data was awaited.
On the New York Mercantile Exchange crude futures for August delivery dipped 0.16% to $43.44 a barrel, while on London's Intercontinental Exchange, Brent eased 0.24% to $45.91 a barrel.
A shakeup that saw Saudi Crown Prince Mohammed bin Nayef has been relieved of his post as defense minister and replaced by Deputy Crown Prince Mohammed bin Salman could imply disputes over Qatar policy, the pace of economic reform symbolized by the proposed Aramco IPO to just family squabbles. For crude however little reax so far. There is little doubt Saudi will keep close ties to the U.S. for now and that overall plans to reform the economy are moving ahead.
Overnight, crude futures settled at a seven-month low on Tuesday, on concerns about an uptick in global production.
Sentiment on oil remained negative for the second-consecutive session, as investors continued to doubt Opec and its allies’ efforts to rebalance supply and demand in the market in the wake of rising global output.
Despite OPEC’s 108% compliance in May with the deal to cut production, rising output from both Nigeria and Libya have added to the glut in supply.
Libya is currently producing 902,000 barrels a day, an official at the state National Oil Corp. said Tuesday. It’s the North African country’s highest output in four years.
Meanwhile, exports of Nigeria's benchmark Bonny Light crude oil are set to reach 226,000 bpd in August, up from 164,000 bpd in July, loading programs show.
Both Nigeria and Libya are exempt from making production cuts.
In May, OPEC and non-OPEC members agreed to extend production cuts for a period of nine months until March, but stuck to production cuts of 1.8 million bpd agreed in November last year.
Expectations that the Energy Information Administration’s weekly inventory report released on Wednesday would reveal U.S. crude stockpiles fell by 2.1 million failed to lift sentiment, as investors remained wary of an unexpected glut in gasoline stockpiles amid weak demand.
Last week, the EIA said gasoline inventories, one of the products that crude is refined into, swelled by roughly 2m barrels against expectations for a decline of 457,000 barrels.