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Oil slips from recent gains, though Middle East tensions remain high

Reuters , Thursday 19 Oct 2017
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Oil prices slipped on Thursday, pressured by larger-than-expected product inventories in the United States, and some profit-taking after a recent run-up in oil benchmarks.

Ongoing tension in the Middle East has kept a bid under the market, however, as reduced flows from the Iraqi Kurdish pipeline through Turkey have raised worries about supply.

Brent crude <LCOc1> fell 64 cents to $57.52 a barrel from Wednesday's mid-week high of $58.15 a barrel by 1135 EDT (1535 GMT). The global benchmark is still about 30 percent above its mid-year levels. U.S. light crude <CLc1> lost 45 cents to $51.59, and is still almost 25 percent higher than June's lows.

Analysts said they have seen some profit-taking after two weeks of gains as upward momentum in prices appears to be waning. Energy equities <XLE> were also weaker, falling to three-and-a-half week lows.

"There seems to be a macro selloff across the board with energy stocks also coming down," said John Kilduff, partner at Again Capital LLC.

The U.S. Energy Information Administration said on Wednesday that U.S. crude inventories fell by 5.7 million barrels in the week to Oct. 13. <C-STK-T-EIA>

U.S. output slumped by 11 percent from the previous week to 8.4 million barrels per day (bpd), lowest since June 2014, as production was shut in by Hurricane Nate.

U.S. distillate and gasoline inventories rose, however, even as refining activity fell. 

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