WTI futures sent reeling by smaller than expected decline in oil stocks

WTI futures sent reeling by smaller than expected decline in oil stocks

WTI futures sent reeling by smaller than expected decline in oil stocks

Commercial crude inventories declined by 1 million barrels last week, after falling 2.2 million barrels the previous week, the Energy Department reported Wednesday.

In the absence of shale oil, Omar Al-Ubaydli, a program director at the Bahrain Center for Strategic, International and Energy Studies, said he believes oil producers would agree to extend the output cut deal.

TheNewsGuru.com reports that on December 10, 2016, OPEC won the backing of countries outside the oil cartel to join supply cuts for the first time since 2001, overcoming the final major obstacle for a global agreement to curb output.

Iran will probably be allowed to keep production unchanged if OPEC decides to extend its limits beyond the first half of the year, Kuwaiti Oil Minister Issam Almarzooq said in an interview in Abu Dhabi, the U.A.E. capital.

Meanwhile, on NYMEX (New York Mercantile Exchange) cost of the United States light crude oil decreased $0.11 to stand at $52.30.

The Secretary General also added that the meeting of the technical subcommittee, where experts will draw up a final report on the agreement's progress, will be held at OPEC headquarters on May 23. Price of the Brent crude oil at the London ICE (Intercontinental Exchange Futures) fell $0.16 to trade at $54.73.

Iran's Rouhani enters presidential race
Beside Ahmadinejad, moderate Rouhani, backed by a group of reformists will have to fight off the challenge from Ebrahim Raisi . The vote is being cast as a referendum on the historic nuclear deal.

USA gasoline stocks posted a counter-seasonal build of 1.5 million barrels, because of rising refining activity.

"Rising U.S. production levels are offsetting more than a third of the six-month agreement of the 1.8 million barrel-per-day cut", McGillian said. On Wednesday, front-month Brent was 53 cents cheaper than the next month LCOc1-LCOc2 Wednesday; it was 29 cents at the beginning of the month.

OPEC, together with other producers like Russian Federation, has agreed to cut output by nearly 1.8 million barrels per day (BPD) during the first half of the year to rein in a global fuel supply overhang that has dragged on markets since mid-2014. The contract, which finished at its lowest level since April 7 on Tuesday, is set to expire at Thursday's settlement.

Oil exports fell to 6.95 million barrels a day, the lowest since May 2015, from 7.7 million a day in January, according to data published Tuesday on the Riyadh-based Joint Organisations Data Initiative website. With the continuation of the deal among the OPEC and Non-OPEC countries producing crude oil, predictions are made about the price to move beyond $60 per barrel.

The oil market has been caught in a tug-of-war, with OPEC production cuts supporting prices while signs of rising USA production have pressured crude on concerns about a glut. Also, U.S. production rose to 9.252 million barrels a day in the most recent week, highest since August 2015.

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