OPEC Squeezes Oil Output to 4-Year Low, Russia Compliance Low

OPEC Squeezes Oil Output to 4-Year Low, Russia Compliance Low

OPEC Squeezes Oil Output to 4-Year Low, Russia Compliance Low

U.S. West Texas Intermediate (WTI) crude oil futures rose 89 cents or 1.7 percent to 53.30 U.S. dollars.

Investors were also hopeful that a new round of talks between USA and Chinese officials would bring the two sides close to resolving their ongoing trade war ahead of a March 1 deadline.

International Brent crude oil futures were up 37 cents, or 0.6 percent, at $63.98 a barrel.

Oil prices were up more than 2 percent on Tuesday on steep OPEC production cuts, with its de-facto leader Saudi Arabia planning to drop March crude output by more than a half a million barrels per day below its initial pledge.

But some said supply-side risks were not receiving enough focus.

The industry's three main agencies are unanimous in reducing their assessments of the volume of oil the world will need from OPEC countries this year compared with what they were forecasting last month. "Reports are emerging that PDVSA is scrambling to secure new markets for its crude, after the USA placed additional sanctions on the country", ANZ bank said on Monday.

While global markets remain comfortably supplied, disruption in Venezuela poses a threat because production of the heavier, higher-sulfur crude it pumps is being reduced elsewhere, the IEA said in a monthly report.

OPEC said on Tuesday that it had cut its output by nearly 800,000 bpd in January to 30.81 million bpd.

USA restrictions on Venezuela's energy sector have crippled exports and threaten to remove some 330,000 bpd in supply from the market this year, according to Goldman Sachs.

"The worries of oversupply stemming from the USA will likely remain a dominant theme as we approach the warmer months", said Edward Moya, market analyst at futures brokerage OANDA.

Oil benchmarks are trading in the green at press time on OPEC's output cuts and supply issues in Venezuela. The cartel OPEC anticipates a declining demand for crude oil, production also fell sharply last month.

The fear of crude prices dropping into the $40s or lower has faded.

Refining profits for gasoline have plunged since mid-2018, going negative in Asia and Europe, amid tepid demand growth and a surge in supply.

Oil prices have remained steady near $60 a barrel in London even as turmoil builds in Venezuela, as markets work through plentiful supplies accumulated a year ago, the IEA said. This article is strictly for informational purposes only. You could lose all of your deposited funds.

"I seek your firm support and collaboration to jointly denounce and face this shameless dispossession of. important assets of one of the members of OPEC". "Saudi Arabia, are intending to push more barrels into the market to offset shortfalls" of heavier grades of crude, the IEA warned. Based in New York, Ed is a regular guest on several major financial television networks including BNN, CNBC, Fox Business, and Bloomberg. He holds a BA in Economics from Rutgers University.

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