Oil prices rose on Thursday, rallying from three-week lows after industry data showed a big draw in US crude stocks, suggesting that the world's largest oil market could be tightening faster than expected.
The major issue for Oil markets is with USA shale's relentless output and resistance to low prices, OPEC are being forced into record levels of cooperation with partners and non-OPEC partners (such as Russia) to try and dent the seemingly endless supply of Oil that has crushed the price in recent times.
Crude oil prices continued to trend higher for the second consecutive fortnight in a row.
A week ago, the Organization of the Petroleum Exporting Countries (OPEC) and some non-OPEC members met in Vienna to roll over an output cut deal to reduce 1.8 million barrels per day (bpd) until the end of next March.
Oil markets were subdued today, with Brent struggling to maintain US$50 (RM214) per barrel as efforts led by Opec to tighten the market were undermined by persistently rising United States production. OPEC Secretary-General Mohammad Barkindo and Russian Energy Minister Alexander Novak said Wednesday that they are looking for ways to formalize a permanent alliance among oil producers to take more control of oil markets.
Commodity markets were absorbing news the United States would withdraw from the landmark 2015 global agreement to fight climate change, a move that fulfilled a major campaign pledge but drew condemnation from USA allies.
API figures showed that US crude inventories fell by 8.7 million barrels to 513.2 million in the week to May 26, compared with analyst expectations for a decrease of only 2.5 million barrels.
"Doubts remain as to the likelihood that inventories will fall as Opec continues to constrain output", ANZ said in a research note.
Car runs into London Bridge pedestrians; multiple injuries
"From 2208 hrs (local time) officers responded to reports of a vehicle in collision with pedestrians on #London Bridge". The U.K. has already been reeling from the May 22 attack in Manchester at a Ariana Grande concert that killed 22 people.
Production cuts by OPEC and its partners are taking longer than expected to eliminate the surplus as USA shale drillers boost production with surprising speed.
USA crude production has also continued to increase, rising to 9.34 million bbl/d, up almost 500,000 bbl/d from a year-ago.
Crude oil prices have been dampened by rising United States output despite Opec production cuts.
Oilfield services firm Baker Hughes on Friday reported its weekly count of oil rigs rose for a 20th straight week.
Meanwhile, monthly data from March shows USA crude oil production of 9.1 million barrels per day increased by roughly 600,000 barrels per day, or about 0.7%, month over month. Libya's crude exports in May rose to the highest level in 31 months on increasing flows from Sharara, the country's largest field, according to vessel-tracking data compiled by Bloomberg.
"The lack of moderation in US production is undercutting OPEC efforts to manage the market", said Michael McCarthy, a chief strategist at CMC Markets in Sydney.