Oil prices on pace for further losses

Oil had rallied above $53 a barrel after some members of the Organization of Petroleum Exporting Countries voiced support for prolonging cuts past June, but rising USA output is undermining the effort to trim a global glut.

On an average annual basis, China's crude oil imports increased by 2.2 million b/d between 2012 and 2016, and the non-OPEC countries' share increased from 34% to 43% over the period. However, still-large inventories and higher output from some producers such as the United States - which is not participating in the supply accord - have limited the rally.

"In other words, production of these refined products is expected to rise, increasing inventories".

Brent crude futures, the worldwide benchmark for oil, were at US$54.77 per barrel at 0354 GMT, down 12 U.S. cents from their last close.

Although crude inventories fell by 840,000 barrels in the week to April 14 to 531.6 million barrels, they held near record highs, while gasoline stocks rose by 1.4 million barrels as refinery runs increased by 334,000 bpd.

Brent crude futures were at $53.31 per barrel at 0108 GMT, up 38 cents, or 0.72 percent, from their last close.

Saudi Arabia committed to lower its output by 486,000 barrels a day to 10.058 million a day while Iraq agreed to cut by 210,000 barrels a day.

The American Petroleum Institute, an industry group, reported Tuesday evening that gasoline supplies rose by 1.4 million barrels.

US crude futures were down 9 cents at $50.50 a barrel.

Iran will probably be allowed to keep its oil production unchanged if OPEC decides to extend its six-month agreement on output cuts beyond June, Kuwaiti Oil Minister Issam Almarzooq said, adding that the Persian Gulf OPEC member has shown strong compliance with the OPEC supply cut deal.

"The rebalancing in USA crude stocks may have got underway, but concerns about further gasoline builds are rife even as the US summer driving season shifts up a gear", said Stephen Brennock, an analyst with PVM Oil Associates.

May natural gas NGK17, +1.53% traded at $3.205 per million British thermal units, up 6 cents, or 1.9%, ahead of the EIA's weekly update on natural-gas inventories due out Thursday.

Both benchmarks closed out the Easter holiday eve higher for a third consecutive week, with Brent adding 1.2 percent over the four days and WTI up 1.8 percent.

OPEC will meet May 25, when a decision on extending the output deal is expected, but Barkindo said it's too early to say whether Iran, Nigeria and Libya, who are now excluded from the output cut, will participate if the cuts are extended.

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