Crude oil rose for a sixth straight session today, 29th June 2017 to its highest since June 19 on a decline in U.S. output, but ongoing worries about global oversupply continued to drag.
U.S. West Texas Intermediate (WTI) crude had risen 28 cents, or 0.6 percent, to $44.01 per barrel by 0215 GMT, while benchmark Brent futures gained 28 cents, or 0.6 percent, to $47.59 a barrel. “The fast ramp-up in shale drilling and the unexpectedly large rebound in Libya/Nigeria production are on track to slow the 2017 stock draws,” investment bank Goldman Sachs said.
“This creates risks that the normalisation in inventories will not be achieved by the time the OPEC cut ends next March. We expect this will leave prices trading near $45 (a barrel) until there is evidence of a decline in the U.S. horizontal oil rig count, sustained stock draws or additional OPEC production cuts.”
The U.S. Energy Information Administration (EIA) said crude stocks rose 118,000 barrels last week, while weekly production declined 100,000 barrels per day (bpd) to 9.3 million bpd. That was the biggest decline in weekly output since July 2016.
OPEC delegates have said they will not rush to cut crude output further or end the exemptions, although a meeting in Russia next month is likely to consider further steps to support the market.