Crude oil settles 1 percent higher over optimisms of market rebalance

Crude oil settles 1 percent higher over optimisms of market rebalance

Crude oil output in the U.S. rose by 89,000 barrels per day (bpd) for the week ending February 15 to reach a new all-time record of 12 million bpd, according to the U.S.' Energy Information Administration (EIA) on Thursday.

Both oil benchmarks have risen this year after the Organization of the Petroleum Exporting Countries and its allies, including Russian Federation, began to cut output to prevent a supply glut from growing.

Oil prices bounced on Friday, as oil rigs in the United States slid this week, offsetting concerns caused by surging USA oil stockpiles.

Citing a goal to reduce the country's dependence on imported crude by 10 percent by 2022, Narendra Modi, prime minister for India, on Thursday endorsed revamped rules that will give producers pricing and marketing freedom that is now non-existent.

The two sides are pushing for an agreement by March 1, the end of a 90-day truce agreed by U.S. President Donald Trump and Chinese President Xi Jinping late a year ago.

Despite the slowdown in economic growth that emerged in late 2018, oil prices have been driven up this year by supply cuts led by the Organisation of the Petroleum Exporting Countries (OPEC).

Oil prices rose on Friday, supported by OPEC's ongoing supply cuts and hopes that Washington and Beijing may soon end their trade dispute.

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The bank said that some weeks could see 4.6 million bpd of gross crude exports by year-end, topping last week's record of 3.6 million bpd.

American benchmark West Texas Intermediate (WTI) gained 1.9 percent over the week to trade at $57.41 a barrel at the same time after starting Monday at $56.33 per barrel.

"We see total USA crude production hitting 13 million bpd by year-end, with 2019 averaging 12.5 million bpd", USA bank Citi said following the release of the EIA report. America is the only country to ever reach production of 12 million bpd.

The Saudi Arabia-led organisation agreed near the end of past year, alongside non-OPEC producers like Russian Federation to curtail oil production by 1.2 billion barrels a day in an effort to stop the commodities decline in price which had been in freefall throughout the latter half of 2018.

"We see total United States crude production hitting 13-million bpd by year-end, with 2019 averaging 12.5-million bpd", United States bank Citi said following the release of the EIA report.

The U.S. will start consistently exporting more crude oil and petroleum products than it imports at the end of next year, EIA recently forecast.

Given the supply and demand picture, Goldman said "we expect $60-$65 per barrel Brent prices, on average, in 2019 and 2020".

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