Oil hits highest since mid-Sept on trade hopes, OPEC cuts
Prices also got support from lower US crude inventories
Prices also got support from lower US crude inventories. PHOTO: Reuters
LONDON:
Oil rose further above $67 a barrel to its highest in over three months on Thursday, buoyed by a report showing lower US crude inventories, by hopes of an end to the China-US trade dispute and OPEC-led efforts to constrain supply.
The American Petroleum Institute, an oil industry group, said late on Tuesday that US crude stocks fell by 7.9 million barrels last week, much more than the decline forecast by analysts.
Brent crude, the global benchmark, reached $67.52 a barrel, the highest since September 17, and as of 1240 GMT was up $0.23 at $67.43. US West Texas Intermediate crude gained $0.11 to $61.22.
"Prices for now are still supported," said Olivier Jakob, oil analyst at Petromatrix. "It's difficult to go against that trend during the holiday period."
Trading volume remains low due to the Christmas holidays, which have delayed the release of the US government's official oil inventory report by two days until Friday.
Also supporting prices, US President Donald Trump said on Tuesday he and Chinese President Xi Jinping would have a signing ceremony for the so-called phase one agreement to end their trade dispute that was put together earlier this month.
The roughly 17-month trade war between the world's two largest economies has hit global growth and demand for oil, weighing on crude prices for most of the year.
Even so, Brent has still rallied 25% in 2019, supported by supply cuts by the Organisation of Petroleum Exporting Countries (OPEC) and allies including Russia.
The so-called OPEC+ group agreed this month to extend and deepen production cuts that would take as much as 2.1 million barrels per day (bpd) of supply off the market as of January 1, or roughly 2% of global demand.
Still, US producers, not party to the OPEC+ agreement, have been pumping record amounts of oil, especially shale. Growth in US production is forecast by many to slow in 2020.
"Oil prices continue to show year-end strength, supported by a combination of definitive progress on the US-China trade deal, the December OPEC/OPEC+ agreement and slowing shale activity," said Stephen Innes, chief Asia market strategist at AxiTrader.
But more supply is coming in the new year from OPEC members Saudi Arabia and Kuwait, which this week agreed to end a dispute over their Neutral Zone, which can supply as much as 500,000 bpd.
Oil rose further above $67 a barrel to its highest in over three months on Thursday, buoyed by a report showing lower US crude inventories, by hopes of an end to the China-US trade dispute and OPEC-led efforts to constrain supply.
The American Petroleum Institute, an oil industry group, said late on Tuesday that US crude stocks fell by 7.9 million barrels last week, much more than the decline forecast by analysts.
Brent crude, the global benchmark, reached $67.52 a barrel, the highest since September 17, and as of 1240 GMT was up $0.23 at $67.43. US West Texas Intermediate crude gained $0.11 to $61.22.
"Prices for now are still supported," said Olivier Jakob, oil analyst at Petromatrix. "It's difficult to go against that trend during the holiday period."
Trading volume remains low due to the Christmas holidays, which have delayed the release of the US government's official oil inventory report by two days until Friday.
Also supporting prices, US President Donald Trump said on Tuesday he and Chinese President Xi Jinping would have a signing ceremony for the so-called phase one agreement to end their trade dispute that was put together earlier this month.
The roughly 17-month trade war between the world's two largest economies has hit global growth and demand for oil, weighing on crude prices for most of the year.
Even so, Brent has still rallied 25% in 2019, supported by supply cuts by the Organisation of Petroleum Exporting Countries (OPEC) and allies including Russia.
The so-called OPEC+ group agreed this month to extend and deepen production cuts that would take as much as 2.1 million barrels per day (bpd) of supply off the market as of January 1, or roughly 2% of global demand.
Still, US producers, not party to the OPEC+ agreement, have been pumping record amounts of oil, especially shale. Growth in US production is forecast by many to slow in 2020.
"Oil prices continue to show year-end strength, supported by a combination of definitive progress on the US-China trade deal, the December OPEC/OPEC+ agreement and slowing shale activity," said Stephen Innes, chief Asia market strategist at AxiTrader.
But more supply is coming in the new year from OPEC members Saudi Arabia and Kuwait, which this week agreed to end a dispute over their Neutral Zone, which can supply as much as 500,000 bpd.