Pessimism bubbles up to leave oil prices mixed

NEW YORK, July 26 (UPI) -- Crude oil prices were trading in mixed territory early Tuesday after BP said more output was expected, but market recovery would be slow.

British energy company BP is among the first of the so-called supermajors to report earnings for the second quarter. The company posted its third straight loss and, while CEO Bob Dudley expected challenges to remain, BP said it was resilient enough to add new barrels to its portfolio during the second half of the year.

BP in its financial release said the market was approaching a viable balance between supply and demand, though the price for Brent crude oil is expected to move lower at least through October and recover possibly to around $55 per barrel during the latter half of 2017.

"We continue to reset our capital and cost base and are moving steadily towards our aim of rebalancing organic sources and uses of cash by 2017 in a $50-55 per barrel oil price range," BP Chief Financial Officer Brian Gilvary said in a statement.

Markets took a cautious posture following the release of BP's earnings and ahead of a policy meeting of the U.S. Federal Reserve, which is looking for clues during earnings season on whether the U.S. economy can cope with any rate adjustments.

The price for Brent crude oil gained 0.2 percent from the previous session to start the trading day in New York at $44.82 per barrel. West Texas Intermediate, the U.S. benchmark price, was down 0.37 percent to open at $42.97 per barrel.

Prices may be influenced by continued supply pressures, particularly for consumer fuel products. A market review this week from S&P Global Platts found U.S. data is expected to show a gasoline draw of 700,000 barrels last week.

"A draw of this size is unlikely to reduce the surplus facing U.S. gasoline stocks," oil futures editor Geoffrey Craig said in an emailed report.