Investing.com - Crude prices rallied in the U.S. on Friday as the International Energy Agency said global supply and demand is falling into balance.
On the New York Mercantile Exchange crude for March delivery rose 1.62% to settle at $53.86 a barrel, while on London's Intercontinental Exchange, Brent gained 1.92% to $55.70 a barrel.
Global oil output dropped 1.5 million barrels per day (bpd) in January, the International Energy Agency (IEA) said on Friday, putting supply and demand on a path to balance later in this year after a major glut of crude on the markiet for nearly two years.
Key to the drop was a coordinated pledge by OPEC and non-OPEC nations led by Russia to trim nearly 1.8 million bpd on averag in the first six months of this year with compliance a touch over 90% in January, led by the world top exporter Saudi Arabia, IEA said.
"Some producers, notably Saudi Arabia, (are) appearing to cut by more than required. This first cut is certainly one of the deepest in the history of OPEC output cut initiatives," the Paris-based IEA said.
If the January level of compliance is maintained, IEA said, output reductions combined with strong demand growth should help ease the record stocks overhang in the next six months by around 600,000 bpd.
Elsewhere, oil rigs at work in the U.S. rose by 8 to 591 by the end of last week, according to oilfield services firm Baker Hughes, marking the most since the week of Oct. 23, 2015 when the count stood at 594.
The number of gas-only rigs rose 4 to 149, bringing active oil and gas rigs to 741, up by 12.