Oil prices pull back as trade tensions weigh on market

Oil Ticks Up to End a Volatile Week

U.S. West Texas Intermediate (WTI) crude futures CLc1 were down 27 cents at $68.69 a barrel by 10:45 a.m. EDT (1445 GMT).

Prices had tumbled to a six-week.

It produced about 11.21 million barrels per day, an increase of 140,000 from a month earlier, according to Bloomberg calculations based on the ministry's data.

US crude loadings for South Korea have been rising since July and arrivals are expected to reach 6 million barrels in each of September and October, the highest ever, according to the sources and trade flow data on Thomson Reuters Eikon.

Crude oil production from the Organisation of Petroleum Exporting Countries increased last month as Saudi Arabia pumped near-record volumes to make good on a pledge to consumers that demand would be met.

Price differentials for the medium-sour Mars grade to Dubai quotes on arrival in North Asia have fallen to 50 cents to $1 a barrel, down from indications of $1-$1.50 at the start of July, partly as China avoided US crude due to potential import tariffs.

Fears that Chinese demand could taper fueled the pullback on Friday after state oil major Sinopec cut its purchases of US crude.

The market's expectation was 2.8 million barrels of crude oil draw.

Oil prices strengthened Thursday, turning higher after traders saw an industry report suggesting US crude stockpiles would soon begin to decline again after a surprise rise in the latest week.

"Crude is holding up with the perspective of reduced Iranian output, but at the same time weighed down by indications of increased OPEC and Russian production for July", Harry Tchilinguirian, senior oil analyst at BNP Paribas said.

Stocks at the key Cushing storage hub in Oklahoma fell by 1.3-million barrels, the lowest level since October 2014, according to data from the Energy Information Administration (EIA).

U.S. President Donald Trump's decision to pull out of an global nuclear deal and reimpose sanctions on Iran has angered Tehran.

Oil prices are also being pressured by concern that global trade tensions could crimp economic growth.

Trump has turned up pressure on China for trade concessions by proposing a higher 25% tariff on $200 billion of Chinese imports and China has said it will retaliate.

At a June 22 meeting, OPEC agreed to boost output by returning to 100 percent compliance with oil output cuts that took effect in January 2017, after months of underproduction by countries including Venezuela and Angola.

OPEC is set to reveal its July production figures in its closely watched monthly oil market report August 13.

The kingdom's higher supply, along with that from Nigeria and Iraq, pushed up OPEC's total output by 300,000 barrels a day last month.

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