Crude oil futures were largely unchanged on Thursday, with the market torn between rising US production and the output cuts being made by Opec and other producers.
Benchmark Brent crude futures were flat at $55.86 a barrel. The market had climbed to a one-month high of $56.65 on Wednesday before losing ground.
US West Texas Intermediate crude futures were down 6 cent at $53.05 a barrel. They touched their highest since March 7th at $53.76 barrel in the previous session.
Traders focused on preliminary US production estimates in the weekly Energy Information Administration report that suggested domestic output was still climbing. The report also showed stockpiles at the US crude hub at Cushing, Oklahoma, rose 276,000 barrels in the week ended April 7th.
However, data showed an unexpected drop in overall US crude inventories, which fell last week by 2.2 million barrels as imports declined by 717,000 barrels a day.
“We saw a bit of a reversal in oil prices [on Wednesday] and it came despite some positive news,” said the chief market strategist at Sydney’s CMC Markets. “It does appear that there is bit of focus on the data that came alongside inventory numbers, which showed further increase in US production.”
Supply cuts
Brent and WTI have rallied in recent sessions after Saudi Arabia was reported to be pushing fellow members of Opec and some rivals to prolong supply cuts beyond June. Opec and other producers, including Russia, agreed late in November to curb output by around 1.8 million barrels per day in the first half of 2017 to rein in oversupply.
The US oil data followed bullish reports from the Opec nations, which said they had cut March output beyond what they had promised.
Also supporting oil markets was customs data showing that China imported a record 9.17 million barrels of crude in March, making it the top importer for the year so far.
However, Opec also raised its forecast for supplies from non-member countries in 2017 as higher prices encourage US shale drillers to pump more, reducing demand for Opec’s oil this year. – Reuters
