Oil rises above $71 on tight supply

Oil rises above $71 on tight supply

Oil rises above $71 on tight supply

Besides, the USA crude had also experienced a five-month high to $64.51 on Tuesday (April 9th), largely led by a sanction on Venezuelan and Iranian crude amid a surging United States oil inventory.

OPEC, Russia and other non-member oil producers agreed to cut output by 1.2 million bpd from January 1 for six months and are set to meet on June 25-26 to decide whether to extend the pact.

Another factor that pushed up crude oil prices today was the monthly report from OPEC that showed Venezuela's oil output dropped to a long term low of below 1 million barrels per day last month, due largely to us sanctions and power shortages. The group's production - at 30.022 million barrels a day in March - is about 758,000 barrels a day below the average amount it believes is needed during the second quarter.

"Brent crude passed the US$70 a barrel mark for the first time in months a few days ago and now, thanks to the new from Libya, it has continued rising". The group pegged 2018 global oil demand growth at 1.41 million b/d.OPEC also revised down non-OPEC oil supply growth in 2019 by 60,000 b/d "due to extended maintenance in Kazakhstan, Brazil, and Canada".

Monthly oil market reports from Opec today (just published today) and the IEA tomorrow will further cast some light on these two major forecasters' views on production and demand going forward.

"The highest incremental production is expected in the Gulf Coast, albeit at a slower pace compared to a year ago due to the pipeline constraints in Permian Basin", it added.

"The blackouts are an additional challenge for Venezuela's oil sector, already set back by economic collapse, corruption, mismanagement and - more recently - by USA sanctions", the Paris-based IEA said in its monthly report.

Azerbaijan has submitted the data on the daily oil production in the country for March 2019 to the joint technical commission of the OPEC monitoring committee, Trend reports referring to the country's Energy Ministry on April 10.

The kingdom has decreased production by 1.30 million bpd since November when it pumped a record high of 11.09 million bpd.

But those of gasoline dropped by 7.7m barrels, which also put them at their five-year average, partly because many refineries were shut down during the seasonal maintenance period. OPEC said it had made some progress towards achieving this goal.

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