WTI oil trading at $97, summer oil supply concerns cap falls

WTI oil futures open Tuesday’s trading session hovering around $97 a barrel after dropping over two percent yesterday, however US oil prices may stabilise around this level as analysts eye up weaker oil output forecasts for the remaining summer months.

Latest WTI Oil Price

US Light crude oil futures for July 2011 delivery was trading at $97.10 a barrel, 06.00 GMT this morning in electronic trading on the NYMEX. The US contract closed yesterday down 2.4 percent at $96.91.

Summer Oil Concerns – Nigeria

Oil giant Shell warned yesterday that it may not be able to meet its contractual obligations in Nigeria for June and July on light crude after multiple pipeline fires in the country and leaks blamed on sabotage.

Nigeria has once again suffered repeated attacks on oil facilities amid unrest in its main oil producing region, the Niger Delta. Nigeria is the world’s eighth largest oil producer.

Libya Oil Output Update

Meanwhile, the newly appointed director of the Libyan rebel National Oil Company said that he believed it would take 10 months to a year after hostilities end for Libya to restore its oil production to the pre crisis level of 1.6 million barrels per day.

Libyan oil production has fallen to under 200,000 barrels per day since the start of the rebellion against Qadhafi in February and oil exports, which averaged 1.3 million barrels per day before the unrest, have been grounded.

US Oil Inventories

The next move forward for WTI oil prices will largely depend on oil inventory data in the US, reported by the US API (American Petroleum Institute) weekly oil inventory data, due out at 20.30 GMT today.

Also, the US EIA (Energy Information Administration) oil inventory data, which will be released at 14.30 GMT on Wednesday.

A preliminary poll ahead of the reports showed forecasts for a 1.0 million barrel drop in US crude oil stocks last week.

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WTI oil trading at $97, summer oil supply concerns cap falls