Oil hits 6-month low on rising production in Nigeria, Libya, US

Oil prices settled more than half a percent lower after hitting a six-month lows, as high global inventories fed fears that rising crude production in Nigeria, Libya and the United States will feed the global supply glut despite output cuts from OPEC and other producing countries .

The dollar rose to its highest in more than two weeks, further weighing on oil by making it more expensive for buyers using other currencies.

Saudi Arabia’s oil exports are expected to fall below 7 million barrels per day this summer, according to industry sources familiar with the matter, and Russian oil exports were seen as broadly flat in the third quarter.

Brent crude fell to a session low of $46.70 a barrel, its weakest since May 5 and near six-month lows. It settled down 8 cents at $46.92 a barrel. US crude settled down 27 cents at $44.46, after touching a six-month low of $44.32 a barrel.

Oil has slumped despite output cuts of 1.8 million barrels a day by the Organization of the Petroleum Exporting Countries (OPEC) and non-OPEC producers including Russia. On May 25, the countries said they agreed to extend the cuts nine months through next March. Yet crude prices have slid about 12 percent since that day as other countries have boosted output.

Libya has seen major supply disruptions from protests and contract disputes, but this week the National Oil Company said production was resuming at key fields.

Both Brent and US crude have given up all the gains since the initial OPEC agreement in late November.