Crude futures were up early in today’s session, extending its gains from the prior session as investors expect to have more production cuts from the major oil produces.
Saudi Arabia’s energy minister Kalid al-Falih stated yesterday that the ongoing production curtailments that are agreed by over 20 producers last year are working, and later added that the cuts could be extended through 2018.
The energy minister’s statements lifted prices but still failed to push prices back to the $50 range, a level that was last attained two weeks ago. On the New York Mercantile Exchange, Light, sweet crude futures for delivery in June traded at $46.48 per barrel, which was up by 5 cents or equal to a 0.1% while in the Globex electronic session. July Brent crude on London’s ICE futures exchange rose by 6 cents that was 0.1% and was being sold at $49.41 per barrel.
The agreement between the Organizations of the Petroleum Exporting Countries and Russia calls for participants to cut 1.8 million barrels a day of their collective output. The objective is to reduce global inventories to the five-year advantage.
The oil glut and an uncertain demand growth have jolted speculators, with data that shows money managers have trimmed their bullish bets on Brent crude to the lowest levels since late November.
Nymex reformulated gasoline blend stock for June ends in flat at $1.5148 per gallon while June Diesel also stood pat at $1.4556 per gallon.