Oil futures weren’t performing that well on Tuesday. The market is currently catching its breath after almost three days of gains. The brimming supply worldwide is also one of the factors that prevent oil prices from further rising.
The Organization of the Petroleum Exporting Countries along with 11 other producers has agreed that they will deepen cuts in May by 1.8 million barrels per day until March. Still, OPEC members Libya and Nigeria have heightened their production, even if the two nations are exempted to the OPEC-led agreement. The organization and non-members are restricting output in an effort to reduce global supply, which is bloated.
OPEC member Iran allowed a minimal increase to recover the loss of the market under Western authorizations, which suggested that its output has outperformed as much as 3.8 million barrels per day and is widely projected to achieve 4 million by March 2018. With several oil rigs operating in the United States today, the shale oil output in the nation has been continuously growing by 10 percent since 2016.
On oil prices, global benchmark Brent crude futures was unchanged at $45.83 a barrel on the day and U.S. West Texas Intermediate (WTI) crude futures lost 2 cents to trade at $43.36 a barrel. So far all throughout this week the market has been on the positive territory. Both U.S. crude oil and Brent, however, have been declining for almost five weeks now.
Reuters market analyst John Kemp relayed in a column that money manager and hedge funds seemed to leave behind all their expectations that OPEC will stabilize the market.