Oil prices sink after International Energy Agency's outlook


US oil inventories slid for a third straight week and the chief of the International Energy Agency predicted worldwide supply will soon be in sync with demand, provided OPEC maintains ongoing output cuts. "Positive revisions were primarily a result of higher-than-expected oil demand from the OECD region and China", the report says, referencing the Organization for Economic Cooperation and Development (OECD), the Paris-based multilateral institution comprising some of the world's biggest economies. "The oil market is obviously trading under tighter fundamentals than it has in the recent past".

Oil prices declined on Thursday, after the International Energy Department reported a bearish outlook of the market. OPEC was said to estimate that its efforts to clear the oversupply will be successful by the end of September 2018.

The price of Brent crude oil rose on Thursday's mixed news, ending the USA trading session at $57.50 per barrel. US West Texas Intermediate crude was at $51.59 per barrel, up 99 cents from its last settlement. Total volume traded was about 44 percent below the 100-day average. For the week, Brent was up nearly 3 percent and US was up over 4 percent.

Brent was at $57.23 at 0914 GMT, up 98 cents. The global benchmark crude traded at a premium of $5.44 to December WTI.

Traders said the oil market pulled back from even higher gains - both contracts were up over 2 percent - earlier in the day out of relief that Trump did not immediately seek to impose sanction on Iran.

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Unrest in Iraq also underpinned prices.

Tensions between the two, which traders fear could cut off oil exports from the region, have been building since Iraqi Kurds overwhelmingly backed independence in a September 25 vote.

At the same time, tensions are building between Iraq's central government in Baghdad and the leaders of the semiautonomous Kurdistan region in the north, which late in September held an independence referendum. "Those two factors are creating a bid for oil".

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