Oil regains strength as focus shifts to U.S. stockpile data

Published 2016-12-20, 08:36 a/m
© Reuters.  Oil rises as focus shifts to U.S. stockpile data
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Investing.com - Oil prices pushed higher on Tuesday, rising back towards the strongest level in more than a year-and-a-half as market players looked ahead to weekly data from the U.S. on stockpiles of crude and refined products.

Industry group the American Petroleum Institute is due to release its weekly report at 4:30PM ET (21:30GMT) later on Tuesday. Official data from the Energy Information Administration will be released Wednesday, amid forecasts for an oil-stock drop of 2.4 million barrels.

Crude oil for February delivery on the New York Mercantile Exchange inched up 39 cents, or 0.74%, to $53.45 a barrel by 8:35AM ET (13:35GMT), within sight of a one-and-a-half-year peak of $54.51 touched on December 12.

Elsewhere, Brent oil for February delivery on the ICE Futures Exchange in London tacked on 59 cents, or 1.07%, to $55.51 a barrel, not far from a 17-month high of $57.89 logged last week.

Oil traders awaited further clarity on whether major crude producers will stick to their promise to pull back on output.

OPEC members agreed to reduce output by a combined 1.2 million barrels per day starting from January 1, their first such deal since 2008.

The pact was followed by an agreement from 11 non-OPEC producers, led by Russia, to cut their supplies by 558,000 barrels a day.

However, some traders remain skeptical that the planned cuts will be as substantial as the market currently expects.

There are also some worries in the market about production increases in the U.S., where rigs drilling for oil rose to a level not seen in almost a year.

According to oilfield services provider Baker Hughes, the number of rigs drilling for oil in the U.S. last week rose by 12 to 510.

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