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Oil prices rise ahead of OPEC monthly report

Published 01/18/2017, 03:52 AM
Updated 01/18/2017, 03:52 AM
© Reuters.  Oil rises before OPEC monthly report

Investing.com - Oil prices were higher on Wednesday, as investors await a monthly report from the Organization of Petroleum Exporting Counties for further evidence that crude producers are adhering to planned output cuts.

Crude oil for February delivery on the New York Mercantile Exchange tacked on 24 cents, or around 0.5%, to $52.72 a barrel by 3:50AM ET (08:50GMT), after rising 11 cents, or 0.2%, a day earlier.

Elsewhere, Brent oil for March delivery on the ICE Futures Exchange in London inched up 33 cents, or about 0.6%, to $55.80 a barrel, after falling 39 cents, or 0.7%, in the prior session.

January 1 marked the official start of the deal agreed by OPEC and non-OPEC member countries such as Russia in November last year to reduce output by almost 1.8 million barrels per day for the next six months.

The deal, if carried out as planned, should reduce global supply by about 2%.

However, some traders remain skeptical that the planned cuts will be as substantial as the market currently expects.

While some major oil producers, such as Saudi Arabia and Kuwait, have so far showed signs that they are sticking to their pledge to cut back output, others, such as Libya have ramped up production.

Meanwhile, market players looked ahead to weekly data from the U.S. on stockpiles of crude and refined products.

Industry group the American Petroleum Institute is due to release its weekly report at 4:30PM ET (21:30GMT) later on Wednesday. Official data from the Energy Information Administration will be released Thursday, amid forecasts for an oil-stock drop of 960,000 barrels.

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The reports come out one day later than usual due to Monday's Martin Luther King Jr. holiday.

Elsewhere on Nymex, gasoline futures for February ticked up 1.1 cents, or 0.7% to $1.613 a gallon, while February heating oil added 0.8 cents, or 0.5%, to $1.657 a gallon.

Natural gas futures for February delivery lost 4.2 cents, or 1.2%, to $3.370 per million British thermal units, as weather forecasts for the end of January turned warmer.

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