Oil rises after Saudi output pledge, declining U.S. inventories

Jorg Hackemann  Adobe Stock

Brent crude futures were up $0.77 at $63.19 a barrel by 1225 GMT while U.S. crude oil futures rose $0.53 to $53.63 a barrel.

Brent crude, the world's oil benchmark, increased 3 percent to $63.32 a barrel after the report was released today.

American supply growth this year will exceed Venezuela's total output, the IEA said, another signal that OPEC's efforts to buoy prices may ultimately prove self-defeating.

"Initial production and supply data from participating countries is beginning to show various levels of conformity, as can be viewed in OPEC's latest Monthly Oil Market Report".

But there are indications that crude supply is beginning to decrease.

None of these options are appealing, and all of them are likely to result in higher costs for refined products, particularly the middle distillates such as diesel and jet fuel that are produced in greater quantities from heavy crudes.

"We believe that oil is not pricing in supply-side risks lately as markets are now focused on U.S". This would help the oil-rich, but cash-poor, country dilute its extra heavy oil for export around the world. "Reports are emerging that PDVSA is scrambling to secure new markets for its crude, after the U.S. placed additional sanctions on the country", ANZ bank said on Monday.

"The imposition of sanctions by the United States against Venezuela's state oil company Petroleos de Venezuela (PDVSA) is another reminder of the huge importance for oil of political events", the IEA said.

Should U.S. -China talks to end trade disputes between the two nations have a positive outcome, the bank said oil markets would "switch attention from macro concerns impacting future demand growth to physical tightness and geopolitical risks impacting immediate supply". "In quality terms, it is more complicated".

WTI prices were also weighed down by the closure of a 120,000 barrels per day (bpd) crude distillation unit (CDU) at Phillips 66's Wood River, Illinois, refinery following a fire on Sunday.

Oil climbed for a second day after Saudi Arabia pledged to deepen production cuts and U.S. President Donald Trump said he might extend a deadline for additional tariffs on China. Venezuela, Libya and Iran are exempt from production cuts.

OPEC is partnering with 10 non-member nations, including Russian Federation, to keep 1.2 million bpd off the market.

Most analysts expect that the OPEC+ supply curtailment deal will ultimately rebalance supply and demand and provide support for higher oil prices.

The Organization of the Petroleum Exporting Countries (OPEC), which Saudi Arabia de-facto leads as the world's top crude oil exporter, said on Tuesday that it had cut its output by nearly 800,000 bpd in January to 30.81 million bpd.

Related news:

Hot News

isis-killer-beheading-video-story-top Trump says could let deadline for inking trade deal with China slide
Feb 14, 2019 - 07:16
President Trump has also said he's unlikely to meet President Xi Jinping before the deadline, dampening hopes of a speedy resolution.

isis-killer-beheading-video-story-top Apple to announce a new subscription-focused service on March 25th
Feb 14, 2019 - 07:09
Apple CEO Tim Cook recently teased that "new services" from Apple are coming in 2019 during an interview with CNBC's Jim Cramer . An Apple spokesman didn't respond to a request for comment.

isis-killer-beheading-video-story-top Jennifer Lopez Defends Heavily Criticized Grammys Motown Tribute
Feb 14, 2019 - 05:25
In addition to Robinson and Ne-Yo, Lopez got a little help from her friend Alicia Keys during the tribute, too. Smokey Robinson , who joined Lopez on stage Sunday, defended her during a pre-Grammy gala on Saturday.

isis-killer-beheading-video-story-top Brad Pitt Sent Jennifer Aniston a Gift Before Her 50th Birthday Party
Feb 14, 2019 - 03:26
Jennifer Aniston hasn't aged a day since we saw her in American sitcom " Friends ". The source said that she "didn't really pay any special attention to Brad".

isis-killer-beheading-video-story-top George Clooney defends Duchess of Sussex
Feb 13, 2019 - 04:38
But she's eight months pregnant, and vilified and persecuted her as Diana. Ecksand describes the jewel as "a ruby like you've never seen before".

isis-killer-beheading-video-story-top Trump taunts Iran on 40th anniversary of Islamic Revolution
Feb 13, 2019 - 04:35
Iranian President Hassan Rouhani speaks during a ceremony celebrating the 40th anniversary of the Islamic Revolution. In January, President Hassan Rouhani said Iran was facing its worst economic crisis since the Shah was toppled.

isis-killer-beheading-video-story-top EA wants to bring Apex Legend to Android and iOS
Feb 13, 2019 - 04:27
United States players were responsible for $320 million of the half a billion total, that took the game 326 days to reach. APEX Legends seems to be doing great and it's the game that has brought Respawn back to everyone's radar.

isis-killer-beheading-video-story-top Axios: More Media for Ocasio-Cortez Than 2020 Dem Candidates
Feb 13, 2019 - 01:43
The initiative has the backing of nearly all the Democrats who have declared they are running in the 2020 presidential election. The measure has attracted support from potential and declared presidential candidates in the Senate, including Democratic Sens.

isis-killer-beheading-video-story-top Keralite woman among 17 killed in Delhi hotel blaze
Feb 12, 2019 - 12:49
In 2017, 14 people were killed, also in Mumbai, when a huge blaze tore through a popular restaurant. Fire fighters searched rooms and toilets to ensure that no one was left trapped, Mishra said.

isis-killer-beheading-video-story-top Kyler Murray is picking football over baseball
Feb 12, 2019 - 12:46
Kyler Murray , the 2018 Heisman victor , is choosing the National Football League over a professional baseball career . Football has been my love and passion my entire live.

isis-killer-beheading-video-story-top Winter storm warning Tuesday
Feb 12, 2019 - 12:45
Heavy snow and ice is forecast to sweep across NY , bringing what forecasters are calling a "messy mix" to the region. In addition to areas in the Northeast, eastern Iowa, Wisconsin and northern MI will experience the worst snow.

isis-killer-beheading-video-story-top Offset Announces Solo Album Release Date
Feb 12, 2019 - 12:44
She took the stage on 10 February at the Staples Center with husband Offset , holding his hand. Finishing up with a scream of 'Oh my god!' it's safe to say Cardi's pretty thrilled.

isis-killer-beheading-video-story-top New 'Aladdin' trailer gives first look at Will Smith as Genie
Feb 12, 2019 - 12:43
The first trailer of the film debuted in October 2018, though fans only got a quick look at Aladdin and his famous lamp. I gotta say, it is pretty weird seeing this big blue dude with Will Smith's smiling face plastered on top.

isis-killer-beheading-video-story-top Theresa May Promises U.K. Lawmakers Brexit Vote by February 27
Feb 12, 2019 - 12:42
He said Mrs May's agreement would achieve most of Mr Corbyn's goals without preventing independent trade deals. The backstop is the main obstacle to securing agreement on the terms of Britain's withdrawal from the EU.

isis-killer-beheading-video-story-top Ole Gunnar Solskjaer: Man United star can become like Cristiano Ronaldo
Feb 12, 2019 - 12:39
Manchester United defender Chris Smalling praised Paul Pogba for his effect on the team following a routine win over Fulham . Edinson Cavani is expected to join Neymar on the sidelines for PSG, heightening the sense of a tie very much in the balance.