Russian Federation reduces oil output by 200000 bpd

Commercial crude oil inventories rose by 0.9m barrels during the week ending on 24 March, according to the Energy Information Administration, the Department of Energy's statistical arm.

Brent crude oil LCOc1 remained unchanged at $52.42 a barrel, while U.S. light crude oil CLc1 grew 5 cents to be traded at $49.56 per barrel, reported Reuters.

This wouldn't explain how US inventories kept on growing before maintenance season, however, so it's more likely than not that Gulf producers are trying their best to arrest the price slide, and the situation in Libya is helping.

The gains added to a rise of more than 1 percent for both crude benchmarks the previous day.

Considering U.S. production and current inventories of crude, even a compliance rate of 100 percent among OPEC members will not drive prices high enough, with or without an extension.

"Production issues ... deepened, with Libyan oil output falling to about 500,000 barrels per day due to the shutdown of pipelines from its biggest field", ANZ bank said on Thursday.

Brent for May settlement, which expires Friday, rose 54 cents, or 1 per cent, to $US52.96 a barrel on the London-based ICE Futures Europe exchange.

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OPEC and 11 other producers including Russian Federation agreed in December to cut their combined output by nearly 1.8 million barrels per day (bpd) in the first half of the year in an effort to eradicate a stubborn supply glut and boost prices.

The US had in December 2015 removed the 40-year-old restrictions on its crude exports following the rapid growth of its oil production from 2013 to 2015.

Oil prices rose Wednesday to finish at their highest level in roughly three weeks.

Singapore received 11,000 bpd of the USA crude oil; Peru, 7,000 bpd; France, 7,000 and Spain bought 4,000 bpd, the EIA data indicated. USA crude settled up 84 cents, or 1.7 percent, higher at $50.35 a barrel, after touching $50.47.

Currently, investors are awaiting as OPEC may decide to extend the production cut beyond June this year.

Other oil exporters outside OPEC, including Russian Federation, have also promised to cut production but so far those reductions have been limited.

  • Sonia Alvarado