Oil price TUMBLES: Crude falls as concern grows over weakening United States demand

Lease Operator Jon Pearson checks well pressure on a lease owned by Parsley Energy in the Permian Basin near Midland

Crude Oil price rebound in broad market as influence from US EIA crude oil inventory update faded away in the market.

The International Energy Agency maintained its outlook for an acceleration in global demand growth this year as lower prices offset the economic slowdown.

"While the other two giants voluntarily cut output, the United States, already the biggest liquids supplier, will reinforce its leadership as the world's number one crude producer", the agency said in its monthly report on global oil markets.

Brent crude LCOc1 was up 82 cents, or 1.3 percent, at $62 a barrel at 1200 GMT.

The Organization of the Petroleum Exporting Countries said in a monthly report that its oil output fell by 751,000 barrels per day (bpd) in December to 31.58 million bpd, the biggest month-on-month drop in nearly two years.

The US could soon overtake Saudi Arabia in the production of crude oil which is now at peak capacity. As of just before 04:00PM UK time, Brent Crude fell 1.01 percent to $60.60 per barrel. Venezuela risks a fresh plunge in oil output, Barclays analysts said in a note.

Output cuts planned by the Organization of Petroleum Exporting Countries and its partners should stabilize world markets, though the process will be slow, the IEA said.

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The U.S. crude output could soon challenge the market share of Saudi Arabia and Russian Federation, the International Energy Agency (IEA) said. While a prolonged government shutdown in the USA and uncertainties over the health of the global economy have rattled broader financial markets, oil prices have responded to signs that the Organization of Petroleum Exporting Countries and its allies have started to clear a glut.

U.S. West Texas Intermediate (WTI) crude futures CLc1 were up 78 cents, or 1.5 percent, at $52.85 per barrel. Longs rose 1.8 percent, while shorts fell 10 percent.

This marks an increase from the end of 2018, but overall it will remain lower than the 2018 average of $71 per barrel, the EIA said.

The IEA said the United States increased output by 2.1 mbd past year, the "highest ever" annual growth ever recorded.

Norbert Ruecker, Head of Commodity Research at Swiss bank Julius Baer, said "the United States is moving forward towards energy independence and is set to become a net petroleum exporter next year thanks to the rising shale output".

"By the middle of the year, USA crude output will probably be more than the capacity of either Saudi Arabia or Russia", CNBC cited the statement as saying.

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