NEW YORK (DTN) -- New York Mercantile Exchange oil futures were mixed at the open of regular trade Thursday morning, giving back earlier gains after the International Energy Agency said production by the Organization of Petroleum Exporting Countries would more than offset a reduction in non-OPEC output.
A weeklong outage of nearly a fourth of Canada's oil production due to wildfires are expected to come to an end soon after the affected oil companies said their facilities in northern Alberta were spared and are now preparing to restart operations.
The oil futures complex has been supported recently by reduced production in the United States, Canada, and Nigeria. The complex rallied pre-market trade this morning after the IEA said it sees stronger global oil demand this year.
At last look, NYMEX June West Texas Intermediate crude futures were up 69cts or 1.5% at $46.92 bbl, off a 6-1/2 month spot high of $47.02. July Brent crude futures on the IntercontinentalExchange were 39cts higher at $47.98 bbl, off a near two-week spot high of $48.12.
In products trade, NYMEX June ULSD futures eased 0.10cts at $1.3957 gallon, reversing off a near two-week spot high of $1.4043. The NYMEX June RBOB futures contract eased 0.25cts to $1.5790 gallon, reversing off one-week high of $1.5853.
The IEA's Oil Market Report for May released today revised global oil demand growth for the first quarter upward to 1.4 million bpd, led by strong gains in India, China, and Russia. For the year, annual consumption growth is projected at 1.2 million bpd, with demand seen reaching 95.9 million bpd.
The IEA said global oil supply rose 250,000 bpd in April to 96.2 million bpd from the prior month as higher output by OPEC more than offset declines in non-OPEC countries. Non-OPEC supply is forecast to drop by 800,000 bpd in 2016 to 56.8 million bpd.
OPEC crude output rose by 330,000 bpd in April to 32.76 million bpd on a 300,000 bpd jump in Iranian flows and a boost in supply from Iraq and the United Arab Emirates that offset outages in Kuwait and Nigeria. Saudi output was steady near 10.2 million bpd. Iranian supply rose to 3.56 million bpd, a level last hit in November 2011, before sanctions were imposed.
The IEA report also referenced the outage of 1.0 million bpd of Canadian oil sands and the 450,000 bpd output disruption in Nigeria, Libya and Venezuela.
Domestically, the Energy Information Administration on Wednesday reported stock draws for crude oil and finished oil products for the week-ended May 6 on demand strength. The EIA said crude stocks fell 3.4 million bbl last week, the first decline since March, and crude production declined 23,000 bpd to 8.802 million bpd for the week. Total products supplied over the last four-week period, a proxy for demand, averaged about 20.1 million bpd, up 3.5% from the same period last year.
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