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Oil prices fell on Wednesday after industry data showed USA stockpiles of crude unexpectedly rose, and as economic growth slowed, especially in Asia, amid the escalating trade dispute between the United States and China.
Despite the hike in crude oil production by 70,000 barrels per day to 32.64 million barrels per day in July, the highest in 2018, the price of oil has risen in recent weeks.
That same day, Reuters forecast that Saudi Arabia's oil output had jumped by 700,000 bpd in June. However, the market would need to see other significant production increases to fully undermine this situation, as the November deadline of the implementation of USA sanctions on Iran is approaching.
"A fresh dose of price angst has come from an unexpected source", said Stephen Brennock of oil broker PVM.
The other OPEC members with drops in production were Venezuela, Angola, and Libya, according to the survey.
OPEC's collective adherence with supply targets has slipped to 111 per cent in July from a revised 116 per cent in June, the survey found, meaning it is still cutting more than agreed.
Supply in Nigeria, often curbed by unplanned outages, rose by 50,000 bpd.
For the record, Trump wants a new deal that limits Iran's ballistic missile program and its role in regional conflicts in Syria, Iraq, Yemen, and elsewhere, as well as makes permanent key aspects of the original accord; Iran has rejected those conditions. Iraq also increased supply as exports rose from the country´s southern terminals.
Unsurprisingly, among countries with lower output, the biggest drop of 100,000 bpd was in Iran.
Tension is rising ahead of the first of two deadlines next week for worldwide businesses to wind down ties with Iran under renewed USA sanctions. Fields in eastern Libya resumed production after a standoff at export terminals ended, but output was cut mid-month at the largest oilfield, Sharara.
Crude is poised for the biggest monthly loss in a year as simmering trade tensions between the United States and China pushed prices lower at a time when American shale output continues to surge.
Russian Federation and the Organization of the Petroleum Exporting Countries boosted output in July, according to a Reuters production survey on Monday.
Kuwait and the UAE have increased their respective production by 80,000 bpd and 40,000 bpd this month, following the OPEC+ decision to boost output.
Trump has been seeking to pad the oil market after he withdrew the USA from the Iran deal, a 2015 pact that lifted sanctions on the country in exchange for restraints on its nuclear weapons program.