Oil Spikes to $56.72$ as OPEC Sticks to Output Pledges

Oil

Oil leaped on Wednesday, March 1, following the pledge of the Organization of Petroleum Exporting Countries, OPEC, to follow through with its pledge to cut output, although evidence of increasing U.S. production capped gains.

The cartel reduced its oil output for a second month in February, a Reuters survey found, showing the exporter group has boosted already strong compliance to around 94 percent.

Heftier cuts by Saudi Arabia and Angola helped offset weaker compliance by other members that agreed to limit their output.

May Brent crude futures rose 21 cents on the day to $56.72 a barrel at 8:00 a.m. ET (1300 GMT), while U.S. West Texas Intermediate (WTI) futures for April delivery rose 18 cents to $54.19.

Brent crude fell 0.2 percent in February, its largest slide in the second month of the year in four years.

Oil prices are 23 percent higher than they were at the end of November, when OPEC announced its deal, but this strength has encouraged more U.S. production to come back online.

U.S. crude stockpiles have risen for seven straight weeks. Forecasts for another build last week, this time of 3.1 million barrels, have fueled worries that demand growth may not be sufficient to soak up the global oil glut.

 

 

 

 

 

 

 

 

 

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