Brent steadies below $ 112, holds near three-week high

Friday, 27 December 2013 00:00 - - {{hitsCtrl.values.hits}}

REUTERS: Brent crude steadied below $ 112 a barrel on Thursday, holding near a three-week high touched earlier in the session, as civil unrest in Africa reduced supply.

The closure of key ports in eastern Libya has slashed output from the OPEC producer to 110,000 barrels per day (bpd) from more than one million in July, while the South Sudan Government has shut 45,000 bpd of its production as a civil war raged on. Brent was unchanged at $ 111.90 a barrel by 0724 GMT after touching an intraday high of $ 112.12, the highest since 5 December. US crude climbed 14 cents to $ 99.36, inching closer to a psychological resistance of $ 100. Both markets were shut for Christmas on Wednesday. “The North African uncertainty is supporting Brent,” said Masaki Suematsu, manager of the energy team at brokerage Newedge Japan. “Most of the news is bullish and the market volume is very thin so prices tend to move higher.” Tribal leaders will hold more talks on reopening several seized oil export ports in eastern Libya but the Government will not negotiate with protesters blocking the ports, Prime Minister Ali Zeidan said. In South Sudan, oil production has dropped to 200,000 bpd after fighting shut down oilfields in Unity state, Petroleum Minister Stephen Dhieu Dau said. Dau said production in Upper Nile state, where most of South Sudan’s oil is extracted, remained safe and outside the reach of rebels. Brent has averaged at about $ 108.66 this year, down nearly $ 3 from 2012 in a well-supplied market although unplanned outages in Africa, the Middle East and North Sea have underpinned prices. Higher production and subdued demand growth could depress Brent to an average of $ 103.50 in 2014, a Reuters survey showed. Traders will be scouring US inventory data for cues on demand in the world’s top oil consumer. The US EIA will publish its data on 27 December at 11 a.m. EST (1600 GMT) instead of its usual release on Wednesdays due to the Christmas holiday. US crude stocks unexpectedly rose 716,000 barrels last week as refineries boosted output, while gasoline inventories slumped and distillate stocks dropped, data from industry group the American Petroleum Institute showed on Tuesday. Analysts had expected oil stockpiles to fall for a fourth straight week and gasoline inventories to rise, a Reuters poll showed. US gasoline futures held on to gains, supporting crude futures, after rising to the highest in more than three months on Tuesday.