Oil advances as Libya halts pipeline from biggest field

Bloomberg

Oil advanced as OPEC member Libya halted the pipeline from its biggest field, tempering concerns that a surplus in the US continues to expand.
West Texas Intermediate futures rose as much as 1.1 percent. Libya’s output has dropped to 560,000 barrels a day following the shutdown of the pipe from the Sharara field, according to a person with knowledge of the matter. US stockpiles probably added 1.38 million barrels last week, a Bloomberg survey showed.
If industry data on Tuesday and government data due on Wednesday show US stockpiles are continuing to rise, it would be further evidence that the effect of output curbs by other producers is being blunted by rising American supply and drilling. Five OPEC countries joined with non-member Oman at the weekend to voice support for prolonging their deal to cut production past June. Output in Libya, exempt from the cuts, had climbed back to 700,000 barrels a day before the pipeline halt.
“Production in Libya has suffered again due to the ongoing political instability and challenging security situation,” said Giovanni Staunovo, an analyst at UBS Group AG in Zurich. “This allows OPEC to achieve a higher compliance rate and has therefore been price-supportive.”
WTI for May delivery was at $48.13 a barrel on the New York Mercantile Exchange, up 40 cents, at 10:23 a.m. London time. Total volume traded was about 30 percent below the 100-day average. Prices declined 24 cents to $47.73 on Monday.
Brent for May settlement was up 39 cents at $51.14 a barrel on the London-based ICE Futures Europe exchange, and traded at a $3.02 premium to WTI. The global benchmark crude fell 5 cents to $50.75 on Monday after declining 1.9 percent last week.