(Refiles to change dateline to LONDON)
* Bloated U.S. market still weighs on prices
* U.S. to review lifting of sanctions against Iran
By Amanda Cooper
LONDON, April 19 Oil steadied on Wednesday after
OPEC said it was committed to eroding a global supply overhang
that has dogged markets since 2014, but with U.S. output and
inventories rising, analysts said prices looked vulnerable.
The oil price got an early lift from comments by the
secretary-general of the Organization of the Petroleum Exporting
Countries, who said the group was committed to restoring market
stability by bringing global inventories down to the industry's
But an investor shift out of equities and commodities and
into perceived safe-havens such as U.S. Treasuries offset some
of this boost.
Brent crude futures were up 5 cents at $54.94 a
barrel at 0908 GMT, while U.S. West Texas Intermediate (WTI)
futures were up 3 cents at $52.44 a barrel.
"Is sentiment on the oil market now taking a negative turn
again? Looking at the latest price reactions, one might conclude
that the only reason for the previous price rise was the
expectation of further production cuts on the part of OPEC,"
Commerzbank strategist Carsten Fritch said.
"After all, the oil price has stopped reacting to the
factors which would normally support it ever since the Saudi oil
minister (Khalid) al-Falih put at least something of a dampener
on such expectations," he said, referring to Falih's comments to
Al-Arabiya television on how it could be premature to discuss an
extension to OPEC's supply cuts.
OPEC and other producers such as Russia have agreed to cut
output by almost 1.8 million barrels per day (bpd) during the
first half of 2017 to drain a supply overhang that has persisted
for nearly three years.
In politics, U.S. President Donald Trump ordered a review of
whether the lifting of sanctions against Iran was in the United
States' national security interests.
Many U.S. sanctions against Iran were lifted in late 2015
under a nuclear deal, allowing Tehran to more than double its
crude exports over 2016, adding to the global overhang.
U.S. markets remain heavily oversupplied, data from the
American Petroleum Institute showed on Tuesday.
Although crude inventories fell by 840,000 barrels in the
week to April 14 to 531.6 million barrels, they held near record
highs, while gasoline stocks rose by 1.4 million barrels as
refinery runs increased by 334,000 bpd.
"Unless the (EIA) data shows something drastically
different, this report should cause a severe dent in the bullish
case (for oil prices)," said Sukrit Vijayakar, director of
energy consultancy Trifecta.
Official U.S. oil data is due to be published on Wednesday
by the Energy Information Administration (EIA).
(Additional reporting by Henning Gloystein in SINGAPORE;
Editing by Dale Hudson)