Oil hovers around $70, clouded by rise in United States output

Oil hovers around $70, clouded by rise in United States output

The price of Brent crude, a global benchmark, was down 0.2 percent at $69.73 a barrel on London's Intercontinental Exchange, while on New York's Mercantile Exchange, West Texas Intermediate (WTI) crude futures CLc1 were unchanged at $64.30 a barrel, according to the Wall Street Journal.

He stressed the supply cut agreement between the Organization of the Petroleum Exporting Countries (OPEC) and non-OPEC producers "should continue despite a rise in oil prices".

Growing signs of a tightening market after a three-year rout have bolstered confidence among traders and analysts.

"We are watching the market and the market is okay in terms of supply and demand balance".

Late in the week, prices received a boost after the United Arab Emirates' (UAE) oil minister hinted that an alliance between OPEC and non-OPEC producers, including Russian Federation, could continue in some way beyond their current deal to curb oil output.

Bank of America Merrill Lynch on Monday raised its 2018 Brent price forecast to $64 a barrel from $56, forecasting a deficit of 430,000 barrels per day (bpd) in oil production compared to demand this year.

Aside from market fundamentals, other factors have helped support crude prices in recent weeks - including tensions between Saudi Arabia and Iran, and possibility of new US-led sanctions on the latter, not to mention the ever-present tensions between the USA and North Korea.

"As we go through 2018 the market is also going to continue to look at geopolitical supply disruptions that could occur in Libya, Nigeria and Venezuela".

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Indeed, the latest data from Baker Hughes showed the USA rig count increased by 10 last week to 752 - the biggest weekly increase in a year and a half.

The head of one of Russia's largest oil producers, Lukoil, said earlier on Friday Russian should start exiting the oil pact if crude prices remain at $70 per barrel for more than six months.

In other news, USA energy companies added 10 oil rigs this week, the biggest increase since June.

Vienna-based consultancy JBC Energy expects U.

"From a fundamental perspective, the surge in U. We see the USA complex as decidedly bearish over the next two months".

The higher prices move, however, adds an additional risk for oil prices as United States shale producers ramp up production and push further supply onto the market.

But Flynn said a fast climb in USA output is not so clear.

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