Crude futures gain on Libya supply, positive UK production data

06 November 2013 12:29  [Source: ICIS news]

LONDON (ICIS)--Crude prices gained more than $1.00/bbl on Wednesday to take Brent crude on ICE Futures above $106/bbl, on the back of constrained Libyan crude oil supply and stronger-than-expected production data from the UK.

By 11:20GMT, December Brent crude had hit a high of $106.41/bbl, a gain of $1.08/bbl from the previous day’s close of $105.33/bbl, before easing back to around $106.16/bbl.

At the same time, December NYMEX light sweet crude futures were trading around $94.17/bbl, having hit a high of $94.25/bbl, a gain of 88 cents/bbl from the previous close of $93.37/bbl.

British factory output rose 0.9% in September from August and was up 2.2% on an annual basis, lifting overall industrial production in the third quarter, the UK Office for National Statistics (ONS) said on Wednesday.

Adding to the bullish tone in the market, oil production from Libya was heard to have almost ground to a halt due to escalating violence in the north African nation. Only two grades are being produced, both of which are sour Bouri and Al-Jurf.

The curtailment of Libyan crude exports have pushed up the value of rival grades such as Algeria’s light-sweet Saharan Blend and Azerbaijan’s Azeri Light grades as refiners seek out alternatives.

Meanwhile, data firm Markit revealed on Wednesday that the October composite and services Purchasing Managers' Index (PMI) for the eurozone stood at 51.9 and 51.6 respectively. A reading above 50 signals growth.

However, the PMI has edged down from September, signalling the eurozone recovery has lost momentum in the beginning of the fourth quarter.

Additional Reporting by Kawai Wong

($1 = €0.74)

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By: Cuckoo James
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