Oil prices rise amid supply cuts

Oil prices rise amid supply cuts

International Brent crude oil futures slid 26 cents to about $67.57, while US West Texas Intermediate (WTI) crude futures were down about 24 cents to $59.17.

Ongoing supply cuts by the Organization of the Petroleum Exporting Countries and allies such as Russian Federation, known as OPEC+, also supported prices.

The price surge triggered a call by U.S. President Donald Trump on Thursday for OPEC to boost production to lower prices.

"Today's fall does not derail the short-term bullish argument that both the OPEC+ production cuts and supply outages will outweigh the global growth concerns and rising USA production", said Edward Moya, senior market analyst, OANDA.

Oil rose almost 2 percent on Tuesday as attention centred on geopolitical factors tightening supplies that are leading to falling exports from Venezuela and declining US inventories. On Tuesday, prices spiked higher as Venezuela's main oil export port of Jose and its four crude upgraders were unable to resume operations following a massive power blackout on Monday, the second in a month. World Markets are fragile, price of Oil getting too high.




Prices have also been driven up by US sanctions on oil exporters and OPEC-members - Iran and Venezuela.

The US President's latest tweet, while calling on the cartel to "increase the flow of Oil", used a rather friendly tone, which is different from previous tweets on the same subject that go further back than his presidency.

Given the OPEC+ cuts, however, Bank of America said it expected oil prices to rise in the short-term, with Brent prices forecast to average $74 per barrel in the second quarter.

Weekly figures on US oil data from the American Petroleum Institute (API), an industry group, will be released on Tuesday, followed by the official Energy Information Administration (EIA) figures on Wednesday. Recent manufacturing data from Asia, Europe and the United States pointed towards developing weakness. This news could be adding further downward pressure on oil prices today thus exacerbating the move lower in Crude following Trump's tweet.

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