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Oil Prices Jump amid Signs of Market Rebalancing

October 10, 2017 at 20:10 by Vladimir Vyun

Crude oil jumped today amid hopes that the market will rebalance as oversupply is reduced. The Organization of Petroleum Countries and Russia signaled that they may prolong or even deepen production cuts implemented to support prices. Saudi Arabia, the major OPEC exporter, promised to reduce its exports by record 7% (560,000 barrels per day in November). Additionally, the OPEC will talk to US shale producers to convince them to limit their output as well to drive prices even higher. On top of that, demand for oil in the United State increases as refineries are coming online after halting their operations due to hurricanes, and that also gave boost to the commodity.

The American Petroleum Institute and the Energy Information Administration will release their estimates of US crude oil inventories on Wednesday and Thursday respectively. Both reports were delayed due to the US holiday on Monday.

November contract for delivery of WTI crude oil jumped as much as 2.7% to $50.92 per barrel as of 19:59 GMT on NYMEX today. December futures for crude oil advanced 1.38% to $56.56 per barrel on ICE.

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