Oil prices edge down

LONDON: Oil prices edged down on Tuesday after the Organization of the Petroleum Exporting Countries (OPEC) reported an increase in its production for May despite a supply cut agreement and said the oil market was rebalancing more slowly than expected.

Benchmark Brent crude was 17 cents lower at $48.12 per barrel by 1236 GMT, reversing gains made earlier in the session when it edged up to $48.67. US light crude was at $45.86 per barrel, down 22 cents.

Prices initially nudged higher after the world’s top exporter Saudi Arabia outlined cuts to customers in July that included a reduction of 300,000 barrels per day (bpd) to Asia.

Riyadh is leading an effort by the OPEC, Russia and other producers to cut output by almost 1.8 million bpd until March in a bid to curb oversupply and prop up prices.

Trade data show OPEC shipments to customers averaged around 26 million bpd in the last six months of 2016 and are set to average around 25.3 million bpd in the first half of this year.

Meanwhile, US drilling activity has continued apace, driving up US output by more than 10 percent since mid-2016 to above 9.3 million bpd.

US crude inventories remain stubbornly high.