OPEC achieved the best compliance rate in its history at the outset of an accord to clear the oil glut, a plan that’s being supported by surprising strength in demand, the International Energy Agency said. The Organization of Petroleum Exporting Countries implemented 90 percent of promised output cuts in January, the first month of its agreement, as key member Saudi Arabia reduced production by even more than it had committed, the agency said. Resilient oil demand is aiding OPEC’s bid to re-balance world markets, growing more than expected last year and poised to do so again in 2017. click Read More below for additional detail
Oil advanced for a fourth day in New York, its longest run of gains in a month, on estimates that U.S. crude inventories continued their decline from record levels seen earlier this year.
Futures added as much as 1.2 percent after rising 2 percent in the previous three sessions. Inventories probably dropped by 2.25 million barrels last week, a Bloomberg survey shows before an Energy Information Administration report Wednesday. As crude stockpiles have declined from their March peak, U.S. output has kept rising and shale producers in the Permian basin will be able to make money even if the price falls to the mid-$20s, according to Scott Sheffield, chairman of Pioneer Natural Resources Co.
West Texas Intermediate for August delivery was at $43.75 a barrel on the New York Mercantile Exchange, up 37 cents, at 9:37 a.m. in London. Total volume traded was in line with the 100-day average. The contract rose 37 cents, or 0.9 percent, to $43.38 on Monday. Prices are down about 10 percent this month, the worst June performance in almost 30 years.
Brent for August settlement was 41 cents higher at $46.24 a barrel on the London-based ICE Futures Europe exchange. The contract added 29 cents, or 0.6 percent, to $45.83 on Monday. The global benchmark crude traded at a premium of $2.52 to WTI.
more at: http://washpost.bloomberg.com/Story?docId=1376-OS6GU66K50XT01-6T7IH6URB5FCH8V2Q35U91QJSP