Iranian heavy crude oil price rises $1.45 per barrel in Jan.: OPEC

Crude Oil Gold Natural Gas

Opec oil production falls as Saudi Arabia slashes output

March West Texas Intermediate crude oil CLH9, +1.60% added 80 cents, or 1.5%, to settle at $53.90 a barrel on the New York Mercantile Exchange, off the intraday high of $54.60. Brent earlier in the session touched $63.98/Bbl, but pulled back after the inventory data was released.

Brent crude futures were up 1.17 USA dollars or 1.9 percent at 62.68 US dollars a barrel by 1135 GMT.

The Organization of the Petroleum Exporting Countries along with allies led by Russian Federation made voluntary production cuts beginning last month aimed at tightening the market. It saw its highest settlement since February 6, according to Dow Jones Market Data.

"We believe that oil is not pricing in supply-side risks lately as markets are now focused on U.S". This is the result of a combination of the OPEC-led production cuts and the sanctions against Venezuelan exports, which are supportive for Brent crude oil, and the rising USA production, which is helping to limit gains for WTI crude oil.

The U.S. Energy Information Administration said on Wednesday U.S. crude stocks rose to their highest since November 2017 as refiners cut runs to the lowest since October 2017 to combat tumbling margins, particularly for gasoline. That marked a fourth-straight week rise, and was larger than the 2.7 million-barrel rise expected by analysts polled by S&P Global Platts.

While OPEC and the EIA lowered their most recent demand expectations, the IEA maintained the same figures from January at 1.4 million barrels per day.

Meanwhile, oil prices rose yesterday as producer club, the Organization of Petroleum Exporting Countries (OPEC) said it had cut supply deeply in January and as US sanctions hit Venezuela's oil exports.

USA crude output is expected to grow by 1.45 million bpd this year and by another 790,000 bpd next year to hit 13 million bpd in 2020, according to the EIA. This doesn't bode well for the long-term crude oil bulls.

Oil prices inched up on Thursday, buoyed by hopes that potential progress in the latest Sino-U.S. tariff talks would improve the global economic outlook. On the other hand, a prolonged struggle may sap even more production from the country and drain some of the excess supply in the market.

Although the US reimposed oil export sanctions last November, it gave a six-month exemption or wavier to eight friendly countries: China, India, Japan, South Korea, Taiwan, Turkey, Italy and Greece to continue buying a restricted quantity of Iranian oil, but it is uncertain if Washington will extend the waivers beyond May.

Latest News