New York, US (BBN) – Crude rebounded in Asia on Monday in a market on a seesaw ride between cheering cuts by the world’s top producers and watching a steadily growing supply response with estimates later in the day on crude and refined product inventories in the US to set the tone.
On the ICE Futures Exchange in London, Brent for April delivery rose 0.41 per cent to $55.79 a barrel, reports
On the New York Mercantile Exchange, crude oil for delivery in March gained 0.32 per cent to $53.10 a barrel.
Overnight, oil settled weaker in the US on Monday after a forecast by the government showed an expected higher production level from U.S. shale drillers in response to higher prices.
Shale oil output in the US is expected to grow by 79,000 barrels per day by March, the US Energy Information Administration (EIA) said on Monday, taking the overall output levels in the US to 4.83 million bpd .
The forecast comes as OPEC said earlier Monday that overall output by the cartel members in the pact in January fell 890,000 barrels per day (bpd) from December to 32.14 million (bpd), putting the supply and demand balance globally on track to even out this year from a glut.
The figures, estimates from industry sources, are seen as the most official view of the success so far of the OPEC leg of a pact the has helped keep oil prices steadily above $50 a barrel for the past two months.
Two of the 11 OPEC member, Nigeria and Libya are exempt from the cuts, while Iran has been allowed a higher production quota within the overall effort.
OPEC said that of the members with target cuts totalling 29.888 million bpd for January, the average was 84,000 bpd above the target, implying a 93 per cent compliance rate, or about 1.16 million bpd, compared to the 1.2 million average sought for OPEC on average in the first half of this year.
An additional 558,000 bpd is coming from non-OPEC nations led by Russia.
Last week, oil futures finished sharply higher, though figures on U.S. rig counts held back further gains.
Oilfield services provider Baker Hughes said Friday that the number of rigs drilling for oil in the US increased by 8 last week, the 14th gain in 15 weeks.