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Oil Prices Rise On Hopes OPEC Will Extend Supply Cuts Into 2019

Published 29/03/2018, 11:06
© Reuters.  Oil prices edge up on OPEC hopes
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Investing.com - Oil prices edged higher on Thursday, as the prospect of an extension to OPEC-led production cuts into next year provided support.

U.S. West Texas Intermediate WTI crude futures tacked on 14 cents, or roughly 0.2%, to $64.52 a barrel by 6:05AM ET (1005GMT).

Meanwhile, Brent crude futures, the benchmark for oil prices outside the U.S., declined 15 cents, or 0.2%, to $68.61 a barrel.

Gains were limited by rising crude inventories and production in the United States.

U.S. crude inventories rose by 1.6 million barrels in the last week to 429.95 million barrels, the Energy Information Administration (EIA) said on Wednesday. That confounded expectations for a decline of around 0.2 million barrels.

U.S. crude oil production rose to a fresh all-time high of 10.43 million barrels per day last week, keeping it above Saudi Arabia's output levels and within reach of Russia, the world's biggest crude producer.

Analysts and traders have recently warned that booming U.S. shale oil production could potentially derail OPEC's effort to end a supply glut.

OPEC, along with some non-OPEC members led by Russia, have been restraining production by 1.8 million barrels per day (bpd) to curb the market of excess supply. The arrangement, which was adopted last winter, expires at the end of 2018.

Elsewhere, in China, Shanghai crude oil futures fell 1% to 409.7 yuan ($65.18) per barrel, pushing the new benchmark to near to parity with U.S. prices.

The latest drop takes the fall since the contract's launch on Monday to 10%.

In other energy trading, gasoline futures were down 0.4% at $2.015 a gallon, while heating oil shed 0.5% to $2.003 a gallon.

Natural gas futures rallied 1.4% to $2.735 per million British thermal units, as traders looked ahead to weekly storage data due later in the global day amid expectations for a withdrawal of 75 billion cubic feet.

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