Oil advances, dollar falls off year highs

Oil futures rose nearly one percent in American trade, paring the losses sustained earlier this week as the dollar index fell for the first time in four sessions away from July 2017 highs, following earlier data from the US, the world's largest energy consumer. 

As of 06:12 GMT, US crude futures due on August 15 rose 1.09% to $70.22 a barrel from the opening of $69.46, while Brent futures due on September 15 climbed 0.72% to $73.10 a barrel from the opening of $72.58, while the dollar index fell 0.70% to 94.50 from the opening of 95.16. 

Baker Hughes reported a drop in the US oil rig count by 5 rigs to a total of 858 rigs, while US output rose to 11 million bpd for the first time on record, nearing Russia's 11.1 million bpd, and passing Saudi Arabia's 10.7 million bpd.

Saudi Arabia's OPEC representatives said the country will avoid supplying the market with more than it needs, noting that Saudi exports could steady in July at same June levels. 

In other news, Libya's state oil corporation halted deliveries at the Zaiwa terminal due to low production after the Sharara oil field, one of the largest in the country, was hit by an attach, with five workers kidnapped.  

Surprise Buildup 

The Energy Information Administration released its report on US crude inventories, showing a buildup of 5.8 million barrels in the week ending July 13, compared to a 12.6M drop in the previous reading, while analysts expected a 3.6M decline, with total stocks now up to 411.1 million barrels, which is 2% below the five-year average for this time of year.

Gasoline stocks on the other hand fell 3.2 million barrels, still 5% above five-year averages, while distillate stocks, including heating fuel, fell 0.4 million barrels, making them 13% below averages.