Oil prices rose more than 1 percent on Friday as members of the Organization of the Petroleum Exporting Countries (OPEC) began initial compliance to the implementation of last year’s landmark deal to curb output in an effort to prop up global oil prices, the International Energy Agency (IEA) has reported.
OPEC, a major global oil cartel, made production cuts in January equating to 90 percent of the agreed volumes, a record high for the first month of implementation for such deals. “Some producers, notably Saudi Arabia, (are) appearing to cut by more than required,” the IEA said in a report.
Global benchmark Brent crude LCOc1 was up 66 cents at 56.29 a barrel by 0938 GMT, touching a session high of $56.39 a barrel shortly after the report’s publication. U.S. West Texas Intermediate (WTI) crude futures CLc1 traded up 56 cents at $56.56 a barrel.
The IEA, which advises industrial nations on energy policy, said that if current compliance levels are maintained, the global oil stocks overhang that has weighed on prices should fall by about 600,000 barrels per day (b/d) in the next six months.
Official OPEC compliance data is due to be released next week.
Olisemeka Obeche (with agency reports)