Oil prices edge up amid Saudi support for extended supply cut

FAN Editor

October 27, 2017

SEOUL (Reuters) – Oil prices inched up in early Asian trading on Friday, with Brent continuing to hover near its highest in 27 months, buoyed by comments from Saudi Arabia’s Crown Prince backing the extension of OPEC-led output cuts.

International benchmark Brent crude futures <LCOc1> were up 9 cents at $59.39 a barrel at 0046 GMT, or 0.15 percent, from their last close, the highest close since July 3, 2015.

U.S. West Texas Intermediate (WTI) crude futures <CLc1> were up 4 cents, or 0.08 percent, at $52.68 per barrel.

Saudi Arabia’s Crown Prince Mohammad bin Salman told Reuters on Thursday that the kingdom would support the extending the output cut deal in a bid to stabilize oil demand and supply.

The Organization of Petroleum Exporting Countries (OPEC) and some non-OPEC producers including Russia have pledged to curb their production by around 1.8 million barrels per day (bpd) until the end of March to drain a global supply glut. OPEC will meet on Nov.30 in Vienna.

Oil prices have hovered around their highest levels of the year in recent weeks amid growing signs of a tightening market including talks over longer OPEC-led output cut deal and geopolitical risks in Iraq and Iran.

“Prices for both Brent and WTI are now approaching important recent range tops. My rhetorical self is bullish longer term and my system is already long,” said Greg McKenna, chief market strategist at futures brokerage AxiTrader.

Although the rising likelihood that OPEC will extend its output cuts raises expectations for a balanced market, U.S. crude production remains an issue for OPEC as it strives to clear a global overhang.

U.S. crude production [C-OUT-EIA] rose by 1.1 million barrels per day to 9.5 million bpd in the week ended Oct.20, according to U.S. Energy Information Administration (EIA) data.

(Reporting by Jane Chung; Additional reporting by Henning Gloystein; Editing by Joseph Radford)

Leave a Reply

Next Post

3 Innovative Stocks for October

Here’s something to wrap your head around: As fast as the world has changed in the last decade, the pace of innovation is actually accelerating. We went from a world without iPhones in 2007 to one dominated by the product just 10 years later. Uber didn’t exist when Barack Obama was […]