Investing.com - Oil prices were mostly flat on Thursday morning in Asia, held steady by healthy global demand but capped by the ongoing surge in U.S. production.
Crude Oil WTI Futures for April delivery were trading at $61.08 a barrel in Asia at 11:35pm ET, up 0.20%. Brent Oil Futures for May delivery, traded in London, were up 0.08% at $64.94 per barrel.
Prices were supported by healthy demand. The Organization of the Petroleum Exporting Countries (OPEC) said on Wednesday that oil consumption was expected to grow by 1.62 million barrels per day (bpd) in 2018.
But overshadowing this market optimism is the relentless increase in U.S. crude output, which hit another record last week by climbing to 10.38 million bpd, up by more than 23% since mid-2016. Commercial crude rose by 5 million barrels, at 430.93 million barrels.
U.S. crude production has already topped that of top exporter Saudi Arabia, and by late 2018 is expected to surpass 11 million bpd, overtaking top producer Russia.
This is undermining OPEC efforts to prop up prices by cutting output. OPEC has been reducing output by around 1.2 million bpd since January 2017, but with the U.S ramping up production, the cuts eat into OPEC's market share.
On Wednesday, OPEC raised its forecast for non-member oil supply to almost double the growth predicted four months ago. The group said non-OPEC producers would boost supply by 1.66 million bpd in 2018.
But OPEC expects demand to grow by only 1.62 million bpd this year, leaving the market oversupplied and in need of more supply restraint.
Estimates by the Energy Information Administration (EIA) also show global supplies will rise above 100 million bpd for the first time in the second quarter of this year, while demand will only surpass that level in the third quarter, implying an oversupplied market.
Currently, oil markets remain relatively weak. Prices have strayed far from their January highs of almost $67 for WTI and over $70 per barrel for Brent.