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Cost of oil futures dropped significantly, reaching at this three-month low, as weak demand and rising Libyan production offset concerns about rising tensions in the country.
Today, Acting Minister of Libya's oil, said that oil production in Libya has risen to 588,000 barrels per day, an increase of approximately 25 percent over the weekend, despite the resumption of fighting between the militias in the capital.
We add that the fighting in Iraq, the second largest producer of OPEC, has not yet spread to the south of the country where three-quarters of its concentrated production capacities.
According to some analysts, the supply of oil on the market enough, but it is likely that it would be excessive by the OPEC countries. World oil demand in 2015 will coincide with the growing supply from the U.S. and Canada. The main demand will be formed by the newly industrialized and developing countries.
"In the oil market now is a correction after the jump in prices in the wake of the Iraq crisis - said BNP Paribas analyst Harry Chilingiryan. - WTI is cheaper because, despite the very high workload refineries in the United States, their oil reserves are still high. "
Market participants expect a weekly report on the U.S. to measure the pace of oil demand from the largest consumer in the world. The American Petroleum Institute will release its report later today, while a government report to be presented Wednesday. Analysts predict that gasoline inventories increased by 900 thousand barrels last week - up to a maximum in March. Oil reserves are expected to have decreased by 2.5 million barrels - up to 380.1 million barrels, while distillate - increased by 2 million barrels.
Also had little impact on U.S. data that showed U.S. retail sales rose a seasonally adjusted 0.2% in June compared with the previous month, showing the weakest growth since January. This was stated by the Ministry of Commerce on Tuesday. Consumers stepped up spending on clothing, general merchandise and health foods, but cut spending on big ticket items such as furniture and cars. Excluding autos, sales rose 0.4%. Economists had forecast a 0.6% increase in total retail sales and an increase in sales excluding autos in June by 0.5%
Cost of the August futures on U.S. light crude oil WTI (Light Sweet Crude Oil) fell to $ 99.31 a barrel on the New York Mercantile Exchange (NYMEX).
August futures price for North Sea Brent crude oil mixture fell $ 2.06 to $ 104.74 a barrel on the London exchange ICE Futures Europe.
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