Oil prices were stable on Friday, pressured as the United States became the world’s top crude producer after its output hit all-time highs, but supported as China remained on track to register another year of record imports.
Front-month Brent crude oil futures were at $72 a barrel at 0554 GMT, down 7 cents from their last close.
U.S. West Texas Intermediate (WTI) crude futures were at $61.72 per barrel, up 5 cents from their previous settlement.
Weighing on prices was record U.S. crude production, which hit 11.6 million barrels per day (bpd) in the week ending Nov. 2, according to Energy Information Administration (EIA) data released on Wednesday.
That’s a threefold increase from the U.S. low reached a decade ago, and a 22.2 percent rise just this year. It makes the United States the world’s biggest producer of crude.
More U.S. oil will likely come. The EIA expects output to break through 12 million bpd by mid-2019, largely thanks to a surge in shale oil production.
Meanwhile, U.S. crude inventories rose by 5.8 million barrels in the week ending Nov. 2, to 431.79 million barrels, the EIA said.
Crude stocks moved back above their five-year average levels in October.
Production has not just risen in the United States, but also in many other countries, including Russia, Saudi Arabia, Iraq and Brazil, stoking producer concerns of a return of oversupply that depressed oil prices between 2014 and 2017.
“Producers are concerned about the potential oversupply … after EIA reported that crude inventories rose by 5.8 million barrels,” said Stephen Innes, head of trading for Asia-Pacific at futures brokerage Oanda in Singapore.
With output overall rising, supply is ample despite the Iran sanctions now in place, prompting rumblings within the Middle East dominated Organization of the Petroleum Exporting Countries (OPEC) that renewed supply cuts may be needed next year to prevent a glut.
“OPEC and Russia may use cuts to support $70 per barrel,” said Ole Hansen, head of commodity strategy at Saxo Bank.
Countering concerns of a renewed glut were record Chinese crude imports.
China’s October crude imports surged 32 percent from a year earlier to 40.80 million tons, or 9.61 million bpd, data from the General Administration of Customs showed on Thursday, climbing from 9.05 million bpd in September. The previous daily record of 9.6 million bpd was touched in April 2018.
Imports rose 8.1 percent for the first 10 months of the year from the same period last year to 377.16 million tons, or 9.06 million bpd, on track for another record year of shipments.