UPDATE 6-Oil rally stalls on talk of OPEC+ boosting output


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    * Russia, OPEC may ditch oil deal to fight for market share
    * Concerns over growing U.S. market share amid record output
    * Supply disruptions from Iran, Venezuela and Libya support 

 (Updates to settlement, adds quotes, U.S. shale output
    By Devika  Krishna Kumar
    NEW YORK, April 15 (Reuters) - Oil prices halted their rally
on Monday, with both benchmarks down nearly 1 percent, after
Russia's finance minister said Russia and OPEC may decide to
boost production to fight for market share with the United
States, where output remains at record highs. 
    Losses were limited by a tightening of global supplies, as
output has fallen in Iran and Venezuela amid signs the United
States will further toughen sanctions on those two OPEC
producers, and on the threat that renewed fighting could wipe
out crude production in Libya.  urn:newsml:reuters.com:*:nB2N1ZT02O
    Brent crude futures  LCOc1  ended the session at $71.18 a
barrel, down 37 cents, or 0.5 percent, having earlier slid below
$71. Brent hit its highest since Nov. 12 on Friday at $71.87.
    U.S. West Texas Intermediate crude futures  CLc1  fell 49
cents, or 0.8 percent, to settle at $63.40 per barrel.    
    Oil prices have been lifted by more than 30 percent this
year, mainly due to a deal by the Organization of the Petroleum
Exporting Countries and its allies including Russia, known as
OPEC+, to curb by 1.2 million barrels per day from Jan. 1 for
six months. The group will meet in June to decide whether to
continue withholding supply. 
    Russian Finance Minister Anton Siluanov said over the
weekend that Russia and OPEC may decide to boost production to
fight for market share with the United States, but this would
push oil as low as $40 per barrel.  urn:newsml:reuters.com:*:nL5N21V0C8
    "There is a dilemma. What should we do with OPEC: should we
lose the market, which is being occupied by the Americans, or
quit the deal?" Siluanov, speaking in Washington, said, TASS
    "(If the deal is abandoned) the oil prices will go down,
then the new investments will shrink, American output will be
lower, because the production cost for shale oil is higher than
for traditional output."
    While the minister said he did not know whether OPEC
countries would be happy with this scenario, the group's de
facto leader, Saudi Arabia, is considered keen to keep cutting,
but sources within OPEC said it could raise output from July if
disruptions continue elsewhere.  urn:newsml:reuters.com:*:nL8N21T5E5
    "Today’s trade provided further evidence of a bull market
beginning to show some wear and tear but also a market that
doesn't appear to have achieved an interim price top," Jim
Ritterbusch, president of Ritterbusch and Associates, said in a
    "Although talk of potential Russian production increase
appeared to weigh on values today, the Saudis remain adamant in
spearheading a sharp OPEC output cut that has thus far remained
undeterred by Brent values above the $70 mark."
    Oil prices have faced pressure from a surge in U.S. crude
output, which is at a weekly record of 12.2 million bpd, thanks
to a shale revolution. 
    U.S. crude oil output from seven major shale formations is
expected to rise by about 80,000 bpd in May to a record 8.46
million bpd, the government said. urn:newsml:reuters.com:*:nL1N21X0YP
    The U.S. drilling rig count, an indicator of future
production, last week rose for a second week in a row.  RIG/U 
    "I would expect oil to trade in a relatively tight band
around $70 for the time being," said Virendra Chauhan, oil
analyst at Energy Aspects in Singapore, pointing to differing
signs from the United States and OPEC on future supply.

U.S. Rig count png    https://tmsnrt.rs/2X8Myf7
CHART: Brent oil biased to fall to $69.11       
CHART: U.S. oil may test support at $62.80       
 (Additional reporting by Aaron Sheldrick in Tokyo and Dmitry
Zhdannikov in London; 
Editing by Marguerita Choy and Kirsten Donovan)
 ((devika.kumar@thomsonreuters.com; +1 646 223 6059; Reuters
Messaging: devika.kumar.thomsonreuters.com@reuters.net))

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