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Oil prices flat as oversupply concerns linger

Reuters  |  SEOUL 

SEOUL (Reuters) - prices were little changed in early Asian trading on Friday after retreating in the previous session, weighed by ongoing glut concerns despite a bigger-than-expected draw in U.S. crude inventories.

Brent crude, the benchmark, was up 1 cent at $51.91 per barrel by 0044 GMT.

U.S. West Texas Intermediate (WTI) crude was up 3 cents, or 0.1 percent, at $48.62 a barrel.

prices touched a two-and-half month high on Thursday, but retreated to close down around 1.5 percent, with U.S. prices slipping back below $50 per barrel amid ongoing oversupply concerns.

"Crude prices failed to hold recent gains, with a nervous market starting to doubt recent falls in inventories. .... Supply side issues also weighed on prices, with data showing Libyan production in July hit its highest level for the year," ANZ bank said in a note.

Official data showed crude inventories in the United States, the world's top consumer, fell sharply by 6.5 million barrels in the week ending to Aug. 4, as refiners ramped up run rates to the highest in 12 years due to strong demand. [EIA/S]

But doubts remain over whether enough crude would be consumed to end a glut after the Organisation of the Petroleum Exporting Countries (OPEC) reported on Thursday another increase in the cartel's production, even though it raised outlook for demand in 2018.

OPEC said its output rose by 173,000 barrels-per-day (bpd) in July to 32.87 million bpd.

Faced with lingering glut woes, OPEC and some non-OPEC members including Russia in May extended production cuts to reduce 1.8 million bpd.

Meanwhile, Russian producer Gazprom Neft is considering resuming production in mature fields after the OPEC-led production cut agreement, a representative of the company said on Thursday.

Rising output from Nigeria and Libya is further undermining the producers' attempt to limit production. Nigeria and Libya are exempted from curbing output as they seek to restore supplies hurt by internal conflicts.

(Reporting by Jane Chung; Editing by Richard Pullin)

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

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