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Forecast predicts two years of record United States oil production

Forecast predicts two years of record United States oil production

World oil demand in 2018 is set to grow by an additional 100,000 barrels per day, according to the latest revision to the figure by the U.S. March Brent rose 12 cents, or 0.2%, to $67.90 on ICE Futures Europe.

Analysts say U.S. output may have levelled off over the holidays.

Yet, surging USA production could offset some of the cuts from OPEC producers, as US production rose to 9.78 million barrels a day (MMBPD) in the latest week, according to last Wednesday's report.

"This is a little more confirmation of what speculators have been looking for and after tomorrow's (U.S. government inventory) report, we'll see if they look to do some profit taking".

Iran said on Tuesday that OPEC members were not keen on increased prices.

Oil prices closed at fresh three-year highs Tuesday, as geopolitical risk and confidence in global growth continued to buoy markets.

Supply reports this week from industry group the American Petroleum Institute and the US government's Energy Information Administration are expected to show USA crude stocks fell 3.9 million barrels, an eighth week of decline.

Oil rose, clinging to last week's gains as political tensions in Iran and declining exploration work in the USA threatened output growth.

A third OPEC source said market fundamentals did not justify the price rally.

Standard Chartered expects oil demand growth to outpace supply growth from non-OPEC countries in both 2018 and 2019, continuing to be the main supporter of prices, analysts wrote Tuesday.

However, Innes added that Middle East turmoil would remain a key focus for oil markets and had the potential to "send oil prices rocketing higher".

"Led by US production, particularly the Permian Basin, and now new oil sands projects in Canada, non-OPEC production is forecast to continue growing through the end of 2019", John Conti, the agency's acting administrator, said in a statement.

Some in OPEC are anxious a prolonged rally could stimulate more USA shale oil output, however, creating more oversupply that could weigh on prices and market share.

Despite this, USA production is expected soon to rise above 10 million barrels per day, largely thanks to soaring output from shale drillers.

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