Oil Steady Amid Pipeline Outage, Decline in U.S. Stocks

By Christopher AlessiFeaturesDow Jones Newswires

Oil prices held steady Wednesday, supported by a continuing outage of a North Sea pipeline and data showing a decline in U.S. crude inventories.

Brent crude, the global benchmark, was mainly flat at $63.81 a barrel on London's Intercontinental Exchange. On the New York Mercantile Exchange, West Texas Intermediate futures were trading up 0.38% at $57.78 a barrel.

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The Forties Pipeline System in the North Sea closed down last week because of a hairline crack, stopping the flow of 450,000 barrels of oil a day. The pipeline operator, Ineos, has said the outage could last for another few weeks.

"The Brent price should thus remain well-supported as a result until at least the end of the year," according to analysts at Commerzbank.

Meanwhile in the U.S., the American Petroleum Institute, an industry group, said late Tuesday that U.S. crude supplies had come down by 5.2 million barrels in the week ended Dec. 15.

"The API is the reason why the energy complex is slightly up this morning," Tamas Varga, an analyst at brokerage PVM Oil Associates Ltd., wrote in a note Wednesday.

Official inventory data from the U.S. Energy Information Administration is due out Wednesday afternoon.

Prices have also been propped up since the Organization of the Petroleum Exporting Countries' decision late last month to extend a deal to curb crude production through the end of next year.

OPEC and 10 producers outside the cartel, including Russia, first agreed a year ago to hold back crude output by nearly 2% in an effort to rein in a global supply glut that has weighed on prices since late 2014.

However, analysts expect steady growth of U.S. shale oil production to put a ceiling on prices next year.

Among refined products, Nymex reformulated gasoline blendstock--the benchmark gasoline contract--was up 1.44%, at $1.70 a gallon. ICE gas oil, a benchmark for diesel fuel, changed hands at $572.50 a metric ton, up 0.62% from the previous settlement.

Write to Christopher Alessi at christopher.alessi@wsj.com

(END) Dow Jones Newswires

December 20, 2017 06:31 ET (11:31 GMT)