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Oil Prices Rise as OPEC Production Cuts Continue

Oil Prices Rise as OPEC Production Cuts Continue

Friday, 3 November, 2017 - 19:15
A table with OPEC logo is seen during the presentation of OPEC's 2013 World Oil Outlook in Vienna , November 7, 2013. REUTERS

il prices rose today, driven by OPEC-led supply cuts that narrowed the gap between supply and demand in the market and supported by strong demand.

By 0739 GMT, global benchmark crude hit $ 60.75 a barrel, up 13 cents, or 0.2 %, from the previous settlement price. Brent climbed nearly 37 percent since hitting its lowest level in June 2017.

US WTI hit $ 54.70 a barrel, up 16 cents, or 0.3 %, from the previous settlement price. US crude rose nearly 30 percent from a record low of 2017 in June. Oil prices are also rising in the current market as Saudi Aramco raised the official sale price of its Arab light crude in December to its Asian customers by 65 cents a barrel from November to $ 1.25.

Global benchmark Brent futures traded up 18 cents at $60.79 a barrel at 11:17 a.m. EDT, after hitting a session high of $61.15. Brent has risen around 38 percent since its low in 2017 reached in June.

More so, US West Texas Intermediate (WTI) crude traded at $54.57 a barrel, up 3 cents. WTI is around 30 percent above its 2017 low hit in June.

Brent was on track for a weekly rise of 0.4 percent and US crude was headed for a 1 percent weekly rise.

“The market continues to find support from expectations that we’re going to see the cut extended and from robust demand,” said Gene McGillian, director of market research at Tradition Energy in Stamford.

OPEC is scheduled to meet at the end of November to discuss further action after it agreed nearly a year ago with Russia and other producers to hold back 1.8 million barrels per day (bpd) of oil supply.

Russia said on Thursday the deal, due to expire in March, could be extended but a decision was not imminent.

On the other hand, Saudi Arabia and Kazakhstan have stressed the need for OPEC and non-OPEC countries to adhere to agreed oil production cuts fully and continuously, according to Saudi state news agency SPA.

Saudi Energy Minister Khalid al-Falih delivered a message to Kazakh President Nursultan Nazarbayev from Saudi King Salman on Friday.

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