Oil prices on both sides of the Atlantic traded in opposite direction on Tuesday, with the US oil (WTI) supported on supply disruption while Brent trades on the back foot amid broad-based US dollar strength after Barkindo Mohammad, OPEC Secretary-General said on Monday that global oil demand for 2018 is estimated to grow 1.6 million barrels per day due to an “encouraging environment.”
He said commercial oil stocks for the OECD rose in January 2018 and were about 74 million barrels over the latest five-year average.
West Texas Intermediate, WTI, oil futures on NYMEX, extends its upward correction into a fifth day, with thin markets fuelling the gains while ongoing supply reductions from Canada to the US due to pipeline reductions also remain supportive of the US oil.
WTI futures were up 1.04 percent to $62.32 per barrel, while Brent crude futures were down 0.30 percent to $65.47 per barrel.
Both crude benchmarks continue to derive support from increased expectations of a tighter market this year, as the OPEC output cuts deal extends its positive impact on the oil markets.
The latest headlines reported by Bloomberg cites the Joint Technical Committee of OPEC and non-OPEC members see the pace of oil rebalancing quickening.
Meanwhile, Suhail Mohammed Faraj Al Mazroui, the UAE energy minister noted that he expects the OPEC oil output deal to extend beyond 2018.
Markets now eagerly await the US API crude stockpiles report for fresh insights on the US supply-side scenario, which will shape up the next direction for the prices.
OPEC Secretary General Mohammad Barkindo, also on Monday, announced that OPEC’s compliance with the imposed production cuts is standing at 133 percent, up from 107 percent last year.