Singapore — Crude oil futures were stable to marginally higher during mid-morning trade in Asia Monday, as the market awaits fresh fundamental drivers to provide price direction while supply side side concerns continue to impact sentiment, sources said.
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At 10:40 am Singapore time (0240 GMT), ICE September Brent crude futures were unchanged from Friday's settle at $74.29/b, while the NYMEX September light sweet crude contract was 19 cents/b (0.28%) higher at $68.88/b.
Market participants were watching out for updates on Saudi Arabia's halt of oil flows through the Bab al-Mandab strait since last week, analysts said.
"The strait is a key waterway for the crude oil market, connecting the Red Sea with the Arabian Sea," ANZ analysts said in a note.
Saudi Aramco suspended oil shipments through the strait last Wednesday after it said two of its VLCCs were attacked by Yemeni Houthi.
Meanwhile, Russia could restore its crude output by as much as 250,000 b/d in July as part of the recent decision by the OPEC-led coalition to increase production, energy minister Alexander Novak said Friday, indicating that the country is returning barrels to the market quicker than had been expected.
"We [expect] that some 200,000-250,000 b/d, out of the 300,000 b/d cut under the production cut deal, will be restored [this month]," Novak said on the sidelines of the BRICS summit in Johannesburg, according to a statement by the ministry's press office.
Novak also said he believes the market has mainly already taken into account the supply risks associated with the Iran sanctions that are due to come into force in November, which is already reflected in current oil prices.
"I think the market has taken into account all those factors [around Iran] and has balanced," he said.
Analysts also pointed to an undated US draft seen ahead of its official release citing the possibility of the US increasing its fuel consumption by 500,000 b/d from 2020 as impacting crude prices.
"Oil prices are trending north this morning, as investors eye on a US draft proposal to increase domestic fuel consumption by 500,000 b/d starting from the year 2020," OCBC Commodity economist Barnabas Gan said.
"Still, we opine that incoming production and demand data into the rest of the year will likely dominate, especially as US oil rig counts rose once again into end July," Gan added.
US oil rig counts were up by two to 1,048 for the week ended July 27, according to Baker Hughes report out last Friday.
As of 0240 GMT, the US Dollar Index was up 0.05% at 94.51.
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--Edited by Irene Tang, email@example.com