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Oil steadies after week of sharp losses on supply outlook

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Reuters LONDON
Last Updated : Jul 17 2015 | 11:48 PM IST

By Simon Falush

LONDON (Reuters) - Brent crude oil steadied on Friday as investors squared positions after a third week of losses on expectations of increased exports from Iran adding to an already heavy supply glut.

International benchmark Brent was up 22 cents at $57.14 a barrel by 1326 GMT. Front-month U.S. crude futures were trading at $50.90 per barrel, up 5 cents from their last settlement.

"With the Iran deal people are aware there is more supply coming so all impetus for a price correction higher has gone," said Hans van Cleef, senior energy economist at ABN Amro in Amsterdam.

Iran has started to ship oil to Asia that it had been storing offshore for months after Tehran and six world powers reached a landmark nuclear deal on Tuesday, clearing the way for an easing of international sanctions on Iran.

Trading volumes were well below average, with many traders in Europe away for the summer break and Singapore closed for a public holiday.

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Brent is almost 3 percent lower for the week and on track for a third week of declines, which would mark the longest losing streak since January. It is down more than 10 percent so far this month.

U.S. crude is also heading for a third weekly decline and is down 3.6 percent this week. It has lost nearly 15 percent this month, its biggest such slump since December.

Expectations of around 500,000 barrels per day more oil coming from Iran by the first half of next year, combined with rising U.S. shale production and high OPEC exports, have helped cut oil prices by nearly half from their year-ago level.

Britain's North Sea Buzzard oilfield ramped up after an outage that started on Wednesday night. The outage slightly pushed up Brent as oil from the field contributes to the calculation of the benchmark's price.

(Editing by Dale Hudson and Susan Thomas)

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First Published: Jul 17 2015 | 11:35 PM IST

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