Commodities

Oil futures were dragged down by high fuel stockpiles but still on track for further gains

OPEC cut extensions

Crude futures were pulled down by improving industry efficiency and heightened fuel stockpiles on Friday. However prices were still on track for further gains in the course of the week.

Last November, the price of crude is around levels after the Organization of the Petroleum Exporting Counties (OPEC) and non-member Russia had an agreement to curb production as much as 1.8 million barrels per day (bpd) between the start of 2017 until the end of first quarter next year. This is an effort to tighten the market, which is currently bloated.

Oil markets around the world are still high according to Sanford C. Bernstein’s oil analyst. They added that for the first half of this year, stockpiles in the OECD could possibly settle higher instead of slumping and the most reasonable explanation is that the agreement of OPEC is not that high than what has been showed.

Bernstein also suggested that the organization should cut deeper and longer if it wants to omit the brimming supplies to support prices, adding that the rise in oil prices have been limited driven by the heightened output in U.S. shale despite of the efforts of OPEC.

Meanwhile in prices, U.S. West Texas Intermediate (WTI) crude futures edged down by 0.2 percent or 10 cents to trade at $45.98 a barrel, it was approximately 4 percent higher for the week and international benchmark Brent crude futures inched down by 0.2 percent or 8 cents to finish at $48.34 a barrel, Brent was about 3.5 percent up for the week.

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