By Nia Williams and Arunima Kumar
(Reuters) -Oil prices rose slightly on Monday, recouping some losses from late last week, as Libyan oil exports remained at a standstill and concerns about higher OPEC+ production from October eased.
U.S. West Texas Intermediate crude rose 49 cents, or 0.7%, to $74.04 at 1924 GMT. futures closed down 59 cents, or 0.8%, at $77.52 a barrel. Trading volumes were light as Monday was a holiday in the US market.
On Friday, Brent and WTI lost 1.4% and 3.1% respectively.
Oil exports at major Libyan ports were halted on Monday and production across the country was curtailed, six engineers told Reuters. This continued the standoff between rival political factions over control of the central bank and oil revenues.
The National Oil Corp. The country’s (NOC) also declared force majeure at the El Feel oil field from September 2.
“The current disruptions in oil production in Libya could provide scope for additional supply from OPEC+. But these fluctuations have become common in recent years, meaning any disruptions are likely to be short-lived; Now the news flow indicates that signals have already been given for a restart of production,” says Bjarne Schieldrop, chief commodity analyst at SEB.
Libya’s Arabian Gulf Oil Company on Sunday resumed production of about 120,000 barrels per day (bpd) to feed a power station at Hariga port.
The Organization of the Petroleum Exporting Countries (OPEC) and its allies, together known as OPEC+, will press ahead with planned oil production increases from October, six sources from the producer group told Reuters.
Eight OPEC+ members will increase production by 180,000 barrels per day (bpd) in October as part of a plan to unwind their latest supply cuts of 2.2 million barrels per day (bpd), while other cuts will continue until the end of 2025 remain in force.
News of increased production pushed oil prices lower last week, but the magnitude of the sell-off was overdone, said Phil Flynn, an analyst at Price Futures Group.
“The market overreacted to the high supply and now it appears the market has put that report into perspective,” Flynn said.
However, Brent and WTI have posted losses for two months in a row as concerns about US and Chinese demand outweigh recent disruptions in Libya and supply risk related to conflict in the Middle East.
More pessimism about Chinese demand growth emerged after an official survey showed on Saturday that manufacturing activity fell to a six-month low in August, as factory prices fell and owners struggled for orders.
