May 1, 2015 / 11:35 AM / 2 years ago

Oil falls from 2015 highs, Iraq exports hit record

Oil rig pumpjacks, also known as thirsty birds, extract crude from the Wilmington Field oil deposits area where Tidelands Oil Production Company, which is owned by Occidental Petroleum Corporation (Oxy), operates near Long Beach, California July 30, 2013. REUTERS/David McNew

NEW YORK (Reuters) - Oil prices eased off 2015 highs on Friday after Iraq said its crude oil exports hit a record in April, and prices were pressured also by a stronger dollar.

Brent and U.S. crude rallied between 20 and 25 percent in April, helped by a weaker dollar and bets that a global supply glut would ease, following the June-to-January sell-off that halved prices from above $100 a barrel.

News that Iraq’s oil exports rose in April to a record 3.08 million barrels per day (bpd) from 2.98 million bpd in March served as a reminder of ample supply in the market.

Iraq’s data highlights increasing output from OPEC members, whose supply in April rose to its highest in more than two years at 31.04 million bpd, according to a Reuters survey.

June Brent LCOc1 was down 86 cents at $65.92 barrel at 11:37 a.m. EDT (1537 GMT), after matching Thursday’s 2015 peak of $66.93 and jumping 21 percent in April.

U.S. crude CLc1 for June delivery was down 84 cents at $58.79, after hitting a 2015 high of $59.90. U.S. crude futures gained 25 percent last month.

Trading was thin, with some major markets closed for the May Day holiday.

“What is driving prices these days is less physical markets, which remain very weak, but more expectations of future tightening,” said Amrita Sen, chief oil analyst at Energy Aspects.

Despite a sharp drop in new U.S. shale drilling in recent months, there have been few signs that a global supply glut is easing, and there are some signs that U.S. oil production may not fall significantly in the near future.

A fresh snapshot of U.S. drilling activity is due from services firm Baker Hughes Inc BHI.N later on Friday, after last week’s report showed companies idled 31 oil rigs.

“Any evidence of a slowed rate of decline such as a drop of less than 15-20 could spur some selling,” said Jim Ritterbusch, president at Ritterbusch & Associates.

“On the flip side, a drop of more than 30-35 will likely force some new highs,” Ritterbusch said.

Futures and options trades suggest U.S shale producers are locking in production costs for next year, which could pave the way for a rebound in production.

“If markets don’t tighten as quickly as people are expecting, the sell-off can be large,” Sen said.

Additional reporting by Ron Bousso in London and Aaron Sheldrick in Tokyo; Editing by David Evans and Bernadette Baum

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