A US government report on Wednesday showed a larger-than-expected increase in USA crude inventories and a rise in gasoline stocks.
The West Texas Intermediate for April delivery increased 0.26 USA dollar to settle at 61.25 dollars a barrel on the New York Mercantile Exchange, while Brent crude for May delivery added 0.54 dollar to close at 64.37 dollars a barrel on the London ICE Futures Exchange.
New Delhi, Mar 1 Crude palm oil prices softened by 0.07 per cent to Rs 600 per 10 kgs in futures trade today as speculators booked profits at prevailing level coupled with easing demand at the spot market. The price difference between oil and fuel has been narrowing - something that can be a bearish signal for oil prices because it could translate into lower demand from refiners, analysts said. "We see more downside for oil".
The cut is the biggest since the U.A.E. reduced production by 120,000 barrels a day in January 2017 when the Organization of Petroleum Exporting Countries and its allies started to curb output to reduce a global glut.
US light crude CLc1 is forecast to average $58.88 a barrel in 2018, up from $58.11 in the January poll. U.S. crude settled down 65 cents, or 1.1 per cent, at US$60.99 a barrel, after touching a low of US$60.18.
Oil prices climbed slightly on Friday after recovering from earlier losses.
"That its oil market is dominated by a large number of uncoordinated, private-sector firms, many of whom benefit from lower production costs than producers elsewhere, means the US will remain a major player for the foreseeable future".
USA output was 10.27 million barrels per day (bpd), according to last week's government figures, higher than the latest figures for the world's largest exporter Saudi Arabia and just below Russian Federation.
"Despite the expanding output curbs by OPEC and non-OPEC members such as Russian Federation, the market has been focusing more on rising US output since around late January", said Tomomichi Akuta, senior economist at Mitsubishi UFJ Research and Consulting in Tokyo. The group's oil output fell in February to a 10-month low as the United Arab Emirates joined other Gulf members in over-delivering on the reduction pact, a Reuters survey found on Wednesday.
Producers are sticking to the cuts and an involuntary drop in Venezuelan output has further boosted compliance.