Opec output cuts drain oil stocks, but higher prices spur more US drilling
With oil output curbs by Opec and other big exporters reducing inventory, the US is cashing in on higher prices and pumping up production
London — Oil prices rose on Tuesday on signs of global market tightening as output curbs by Opec and other producers shrink stocks, but a rise in US drilling could keep a lid on prices. Benchmark Brent crude was up 40c at $55.63 a barrel by 8.40am GMT. US light crude was 40c higher at $53.15. Oil ministers of Opec and other exporter nations said on Sunday that of the almost 1.8-million barrels per day (bpd) they agreed to remove from the market from January 1 a cut of about 1.5-million bpd had already been achieved. The supply balance already appears to be tightening. Bernstein Energy said global oil inventories fell by 24-million barrels to 5.7-billion barrels from last year’s third to fourth quarter. That came to about 60 days of world oil consumption. "This is the biggest quarterly decline since the fourth quarter of 2013, confirming that inventory builds are now reversing as the market shifts from oversupply to undersupply," said Bernstein analysts. Opec members appear to be sti...
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