Iraq, Algeria support extension of oil production cuts

Iraq, Algeria support extension of oil production cuts

On Monday, Saudi Arabia's oil minister Khalid al-Falih said he expected the output deal to be extended to the end of the year or possibly longer.

However, analysts remained concerned about rising output from the US, Libya and Nigeria and questioned whether the rebound could be sustained.

In the United States, U.S. crude stockpiles posted their biggest one-week drawdown since December last week as imports dropped sharply, while inventories of refined products also fell.

Global benchmark Brent futures LCOc1 were up 19 cents, or 0.4 percent, at $48.92 a barrel at 0612 GMT.

WTI (West Texas Intermediate) crude oil (XOP) (XLE) (VDE) futures contracts for June delivery rose 3.2% and settled at $47.33 per barrel on May 10, 2017.

The American Petroleum Institute reported Tuesday stockpiles fell by 5.8 million barrels last week, more than the 1.8 million-barrel slide analysts predicted. WTI crude oil averaged $43.33 a barrel in 2016 and is forecast to rise to an average of $50.68 in 2017, down $1.56 a barrel compared with last month's estimate for 2017. The Energy Information Administration boosted its estimate for average USA output this year to 9.31 million barrels a day, up from 9.22 million a day projected in April.

The decline in USA crude oil inventories is likely due to the increase in gross inputs to refineries in April.

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Aramco and other producers typically issue monthly notices to refineries and other buyers with contracted supplies outlining their intended allocations to each customer.

LONDON/DUBAI May 11 Turkmenistan is likely to join an OPEC-led cut in oil supply aimed at supporting prices, sources in OPEC and the industry said, potentially enlarging the output reduction slightly.

Even though OPEC has stuck to its pledge to cut production, US output C-OUT-T-EIA has risen by more than 10 percent since mid-2016 to 9.3 million barrels per day, close to the output of Russian Federation and Saudi Arabia.

Oil cartel Opec and other producers including Russian Federation have pledged to cut output by nearly 1.8-million barrels a day during the first half of the year.

Currently, OPEC is planning to extend the tenure of this oil curb to the year-end or to next year.

Many oil producers in the region have been badly hit by low prices with many turning to bonds and loans to make up for revenue losses.