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Crude Oil Flat amid Clashing Fundamentals

February 17, 2017 at 21:32 by Vladimir Vyun

Crude oil was trading in a narrow range on Friday, heading to settle basically flat (though currently crude is trying to carve out small gains), as clashing fundamentals provided no help to the commodity in finding a direction.

The Organization of Petroleum Exporting Countries signaled that it may extend and expand its production cut deal. So far, estimates show amazing 90% compliance to the agreement, though experts voiced doubt that all the participants of the deal will resist temptation to boost production if prices go significantly higher.

The problem is that whatever positive effect on the market the output cuts bring will likely be outweighed by the increase of supply from the United States. Baker Hughes reported that the number of US oil rigs increased by six this week. It was the fifth consecutive weekly increase, and now the oil rig count stands at the highest level since October 2015.

March futures for delivery of WIT crude oil ticked up 0.07% to $53.40 as of 21:04 GMT on NYMEX today. April contract for Brent crude rallied 0.18% to $55.75 per barrel on ICE.

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