Crude oil futures rebounded after early weakness and settled modestly greater on Monday, supported by OPEC-led production cuts and on U.S. sanctions versus Iran and Venezuela.
OPEC’s de-facto leader Saudi Arabia stated over the weekend that the alliance will “stay the course” on restricting output as inventories continued to remain high.
A report from the Energy Information Administration said petroleum production from significant U.S. shale plays its forecast to climb up by 85,000 barrels a day in April to 8.592 million barrels a day.
The report said that oil output from the Permian Basin is expected to climb up sharply, rising 40,000 barrels a day in April from March.
West Texas Intermediate Crude oil futures for April ended up $0.57, or about 1%, at $59.09 a barrel, the highest settlement on more than 4 months.
On Friday, oil futures for April ended down $0.09, or 0.2%, at $58.52 a barrel.
According to reports, OPEC and its allies have reportedly canceled a meeting they had actually arranged for in April, in order to examine the impact of U.S. sanctions on Iran and Venezuela.
The OPEC anticipates the market will stay oversupplied through the first half of 2019, said Saudi Energy Minister Khalid al-Falih at a committee meeting in Baku, Azerbajian.
The Joint Ministerial Keeping An Eye On Committee (JMMC), which met today, stated that “total conformity” with the production cut agreement amongst the Company of the Petroleum Exporting Countries and some nonmember allies that began at the start of the year rose to almost 90% in February, up from 83% in January.
The JMMC said its next conference will remain in May and then the complete group of OPEC will gather on June 25 to choose output cut extensions.
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