On Wednesday, Brent crude oil prices were close to two year highs as OPEC has notably improved compliance with its promised supply cuts, meanwhile Russia is also noticed keeping its part of the deal.
The international benchmark for oil prices, Brent futures LCOc1, were at $61.16 per barrel at 0045 GMT, up by 0.36 percent or 22 cents, since their last close and within range to the $61.41 per barrel two year high from intraday trading on Tuesday. Brent is up approximately 38 percent since its 2017 lows last June.
CLc1 U.S. West Texas Intermediate (WTI) was at $54.65 per barrel, up by 0.5 percent or 27 cents, near to February highs. Since its 2017 low in June, it is up nearly 30 percent.
Bullish sentiment has been motivated by an effort this year lead by the OPEC (Organization of the Petroleum Exporting Countries) and Russia to desist about 1.8 million barrels per day in oil production to constrict markets.
OPEC’s October yield decreased by 80,000 barrels per day to 32.78 million bpd, putting faithfulness to its pledged supply curbs which were up from September’s 86 percent to 92 percent.
Russia is also seen observing the output cuts by around 300,000 bdo below October 2016 levels of 11.247 million barrels per day.
The pact will continue until March 2018. Saudi Arabia and Russia are backing up the extension agreement to possibly cover all of next year.
Another significant factor will be the U.S. output, which has increased to almost 9.5 million bpd or by approximately 13 percent since mid-2016.
According to Barclay’s bank, the U.S. crude oil production is 410,000 bpd under the April 2015 highest of 9.62 million bpd.