Oil prices edge up as OPEC says its crude output fell sharply in December

Reuters
Sydney NSW, Australia Updated: Jan 18, 2019, 10:20 AM(IST)

File photo. Photograph:( Reuters )

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US West Texas Intermediate (WTI) crude futures were at $52.40 per barrel at 0026 GMT, up 32 cents, or 0.6 per cent, from their last settlement. WTI futures closed down 0.4 per cent on Thursday.

US oil prices inched higher on Friday after a report from the Organisation of the Petroleum Exporting Countries showed its production fell sharply last month, easing fears about prolonged oversupply.

US West Texas Intermediate (WTI) crude futures were at $52.40 per barrel at 0026 GMT, up 32 cents, or 0.6 per cent, from their last settlement. WTI futures closed down 0.4 per cent on Thursday.

International Brent crude oil futures had yet to trade, after closing up 1.1 per cent in the previous session.

OPEC cut oil output sharply in December before a new accord to limit supply took effect on January 1, it said on Thursday, suggesting that producers have made a strong start to averting a glut in 2019 as a slowing economy curbs demand.

"The OPEC+ production cuts (that stared this month) will be paramount to keeping the market tight and supporting prices," ANZ said in a research note. The body is making cuts along with other major producers such as Russia.

OPEC said in its monthly report that its oil output fell by 751,000 barrels per day (bpd) in December to 31.58 million bpd, the biggest month-on-month drop in almost two years. 

But tempering that support for prices, OPEC also cut its forecast for average daily demand for its crude in 2019 to 30.83 million barrels, down 910,000 bpd from the 2018 average.

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