Oil prices rise on supply troubles

BEIJING: Oil prices on Thursday rose on the back of plunging exports by Opec-member Venezuela, recovering some ground lost in the previous session, although another surge in US production still weighed on markets, traders said.
Brent crude futures were up 51 cents, or 0.7 per cent, to $75.87 a barrel at 0710 GMT.
US West Texas Intermediate (WTI) crude was up 30 cents, or 0.5 per cent, at $65.03 a barrel.
It ended the previous session 1.2 per cent lower at $64.73 a barrel.
Venezuela, a member of the Organization of the Petroleum Exporting Countries (Opec), is struggling to meet its supply obligations, with dozens of tankers waiting to take on its oil.
Tankers waiting to load more than 24 million barrels of crude, almost as much as PDVSA shipped in April, are sitting off the country’s main oil port, according to shipping data.
The backlog is so severe that state-owned PDVSA has told some customers it may declare force majeure, allowing it to temporarily halt contracts, if they do not accept new delivery terms.
“The decline in Venezuelan supplies has been bigger than market expected. Increases in US production will not be able to fully offset the drop from Venezuela and Iran”, said Bruce Xue, oil analyst with Haitong Futures.
Venezuela’s supply trouble comes amid voluntary production cuts by Opec which have been in place in order to tighten the market and prop up prices.— Reuters