Posted by support on October 21, 2016

SINGAPORE (Reuters) - Oil prices were stable on Friday, weighed by a stronger dollar, but supported by signs that physical fuel markets were tightening after two years of ballooning oversupply.
The dollar rose to its highest level since March against a basket of other leading currencies on Friday, potentially crimping demand as fuel becomes more expensive for countries using other currencies.
This came as China's offshore yuan fell to its lowest level in six years against the dollar.
U.S. West Texas Intermediate (WTI) crude was trading at $50.59 a barrel at 0652 GMT, down 4 cents from its last settlement.
Brent crude futures were up 7 cents at $51.45 per barrel.
Crude prices fell over 2 percent in the previous session on the back of the soaring dollar.
Also weighing on markets was another jump in Chinese diesel and gasoline exports, which have contributed to Asia's fuel supply overhang as China's refiners continue to produce more fuel than its domestic market can consume.
Despite the Chinese exports, sentiment in physical oil markets was confident as there are mounting signs of a tightening oil market.
"The near term fundamentals in the oil market have turned positive. Demand is stabilizing, OPEC production has peaked (and will fall if cuts are implemented), and global inventory declines imply that the market is more balanced than many believe," Neil Beveridge of Bernstein Energy said in a note to clients.
The Organization of the Petroleum Exporting Countries (OPEC) plans to implement a 500,000 to 1 million barrels per day production cut after a meeting on Nov. 30.
OPEC's current output stands at a record 33.6 million barrels per day.
Bernstein's Beveridge said that due to OPEC's cuts and general market conditions, he was "forecasting a return to $60 per barrel in 2017 and $70 per barrel in 2018", adding that even higher prices would be prevented by rising production outside OPEC.
"Ultimately, a rise in U.S. production (and non-OPEC supply more broadly) will cap the recovery in price," he said.
The World Bank was more cautious, raising its crude price forecast for 2017 to $55 a barrel on Thursday, up from $53 previously.
U.S. crude oil production has fallen almost 12 percent since peaks in 2015, to around 8.5 million barrels per day. But rising drilling activity has slightly lifted output again in recent weeks, in what some analysts say is an early indicator that the U.S. shale industry has adapted to lower prices and can operate at around $50 per barrel.