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Oil Rallies on High OPEC Production Cuts Compliance

December 5, 2017 at 21:44 by Vladimir Vyun

Futures for crude oil rose today amid hopes that the oil production cut deal between the members of the Organization of Petroleum Exporting Countries and Russia will continue to support prices. The OPEC and Russia agreed last week to extend output cuts until the end of 2018. The OPEC production was at the lowest level in half a year. According to some report, compliance to the agreement was more than 100% as some countries were producing less oil than they are allowed by the agreement.

Prices also rose as market participants were anticipating that US crude oil inventories will continue to shrink. Experts predicted that tomorrow’s report from the Energy Information Administration will show a drawdown of 3.2 million barrels. As usual, before the government data the American Petroleum Institute will release its private report.

January contract for WTI crude oil advanced 0.35% to $57.67 per barrel as of 21:39 GMT on NYMEX today. February contract for crude gained by 0.75% to $62.92 per barrel on ICE.

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