Oil prices extend drop on easing supply fearsFriday 04 July 2014 11.56
Oil prices fell further today on easing concerns over supply disruptions, offsetting firm demand for crude in the US and China.
Brent North Sea crude for delivery in August dipped 13 cents to stand at $110.87 a barrel in London.
US benchmark West Texas Intermediate for August slipped 16 cents to $103.90 compared with last night's close.
Analysts said that supply fears have begun to ease after Libya declared an end to an oil crisis that has slashed exports.
Crude prices began sliding on Wednesday after Libya's interim Prime Minister Abdullah Al-Thani declared that authorities had wrested control of export terminals from rebels.
Production in Libya, a member of the OPEC oil cartel, has been severely limited for a year since rebels blockaded terminals as part of a campaign to restore autonomy in the country's eastern region. Its output currently stands at some 320,000 barrels a day, about a fifth of its normal production.
Back on the supply side, concerns over a possible supply disruption due to Iraq's security crisis have also eased. Islamist militants have overrun swathes of territory in Iraq since June 9, but have so far not yet directly threatened the key oil-producing region in the country's south.
Oil price losses have been capped, however, by a bigger-than-expected drop in US crude inventories. The US Energy Information Administration earlier this week said US commercial crude inventories fell 3.2 million barrels last week, almost twice the amount predicted by analysts.