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Crude Oil Prices Rise on Renewed Optimism

Published 16/02/2018, 09:11
© Reuters.  Crude oil moves higher on UAE remarks
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Investing.com - Crude oil prices rose on Friday, helped by a weak U.S. dollar and by hopes for further efforts to limit global oil output.

The U.S. West Texas Intermediate crude March contract was up 43 cents or about 0.72% at $61.78 a barrel by 04:05 a.m. ET (08:05 GMT), the highest since February 8.

Elsewhere, Brent oil for April delivery on the ICE Futures Exchange in London gained 55 cents or about 0.87% to $64.89 a barrel.

The greenback turned broadly lower amid sustained concerns over the deficit in the U.S., which is projected to climb near $1 trillion in 2019 following the announcement of infrastructure spending and large corporate tax cuts.

A weaker greenback often boosts prices for dollar-denominated commodities.

The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was down 0.23% at 88.27, the lowest since December 2014.

Oil prices also found support after United Arab Emirates energy minister Suhail al-Mazroui said on Thursday that oil producers led by Saudi Arabia and Russia aim to draft an agreement on a long-term alliance to cut output by the end of this year.

The Organization of the Petroleum Exporting Countries (OPEC), along with some non-OPEC members led by Russia, agreed in December to extend oil output cuts until the end of 2018.

The deal to cut oil output by 1.8 million barrels a day (bpd) was adopted last winter by OPEC, Russia and nine other global producers. The agreement was due to end in March 2018, having already been extended once.

The commodity had already received a boost earlier in the week when Saudi Energy Minister Khalid al-Falih said his country will be “sticking” with its policy to withhold production throughout 2018.

However fears that rising U.S. output could dampen OPEC’s efforts to rid the market of excess supplies have systematically limited oil prices' gains recently.

The Energy Information Administration reported on Wednesday that U.S. crude oil production rose to a fresh record of 10.27 million barrels per day (bpd), more than top exporter Saudi Arabia and not far from the biggest world producer, Russia.

Elsewhere, gasoline futures gained 0.43% to $1.748 a gallon, while natural gas futures lost 0.85% to $2.558 per million British thermal units.

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