Oil slips as focus turns to surplus from shortage

NEW YORK (Reuters) – U.S. crude oil futures fell on Tuesday as worries over supply disruptions eased and the focus moved to increasing domestic production and potential damage to global growth of the U.S.-China trade dispute.

U.S. West Texas Intermediate crude (WTI) CLc1 was 81 cents lower at $ 67.26 a barrel by 10:53 a.m. EDT [1453 GMT]. It lost 4.2 percent on Monday.

Brent futures LCOc1 rose 9 cents to $ 71.93 in barrel, after earlier trading as low as $ 71.35 in barrel, its lowest since April 17. Brent fell 4.6 percent on Monday.

"Fears of shortages, which is about to be increased," Carsten Menke, commodity research analyst at Swiss private bank Julius Baer, ​​said.

The market is waiting for clear signals on supply, including whether or not the oil and gas industry is likely to be rebroaded after June and early July, said Tariq Zahir, managing member at Tyche Capital in New York.

"You are really going to produce, along with Russia," he said.

Russian crude production could also ramp up, restoring 300,000 barrels per day (bpd) that were cut in an agreement with OPEC, he said.

"I think we're going to get a better balanced market."

Oil prices have fallen by almost 10 percent in the last week.

Production from seven major U.S. shale oil formations is expected to rise by 143,000 bpd to a record 7.47 million bpd in August, the U.S. Energy Information Administration said on Monday. Output is expected to rise in all seven formations.

Intercontinental Exchange (ICE) ( ICE.N ) The United States of America, United States of America hub.

The new contract for the production of crude oil. The contract underscores the rising volumes of crude from the Permian that are more prevalent for export.

Also, the United States and other major trading blocks, particularly China, could significantly reduce the demand for capital.

China this week reported a weakening growth for the second quarter and weakest expansion in the industry in June in two years, suggesting a further softening in business conditions in the coming months as trade pressures build.

Beijing's state planning agency said it was still confident of hitting its economic growth target of 6.5 percent this year, despite views it has bumpy second half as the trade row with Washington intensified.

Goldman Sachs said it expects price volatility to remain elevated, keeping Brent in a $ 70- $ 80 per barrel range in the short term.

"Supply shifts, alongside the ongoing surge in Saudi production, create the risk that the oil market moves into surplus" in the third quarter, the report said.