Oil edges higher as Kuwait confirms commitment to cutting output

Published January 5th, 2017 - 06:15 GMT
Earlier selloff came as traders grew anxious about whether OPEC members and other oil producers would scale back output as part of a deal agreed in late 2016. (Shutterstock)
Earlier selloff came as traders grew anxious about whether OPEC members and other oil producers would scale back output as part of a deal agreed in late 2016. (Shutterstock)

Oil futures edged higher on Wednesday, rebounding from the prior day’s sharp selloff on signs that major oil producers are sticking to their pledge to cut output.

February West Texas Intermediate crude CLG7  rose 14 cents to $52.47 a barrel on the New York Mercantile Exchange, while March Brent LCOH7 added 16 cents to $55.63 a barrel on the ICE Futures exchange in London, reported Market watch.

On Tuesday, prices for WTI and Brent crude staged a sharp reversal from their highest levels in about 18 months to mark their lowest settlements in about two weeks.

The selloff came as traders grew anxious about whether members of the Organization of the Petroleum Exporting Countries (Opec) and other oil producers will scale back output as part of a deal agreed in late 2016. The accord kicked in on January 1.

However on Wednesday, state-owned Kuwait Petroleum Corporation moved to dispel some of that anxiety, saying it was committed to curbing output and had notified clients that the production cuts would be in effect from the start of January and for the whole first quarter, according to Reuters.

Brent crude prices climbed about 52 per cent in 2016 to post their first yearly increase in four years. WTI prices rose about 45 per cent last year—the first rise in three years.

 

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