SINGAPORE (Reuters) – Oil prices rose higher on Thursday after OPEC + alliance of key producers adhered to a lower production policy at Wednesday’s meeting, and as U.S. crude stocks fell to their lowest levels since March last year.
Brent crude futures gained 4 cents, or 0.1%, to $ 58.50 per barrel, before 0120 GMT. On Wednesday, Brent prices hit their highest level since February 21, 2020.
U.S. West Texas Intermediate (WTI) crude futures climbed 13 cents, or 0.2%, to $ 55.82 a barrel after reaching the highest settlement rate in a year on Wednesday.
“Crude prices have been rising higher now that OPEC + has demonstrated to the energy market that they are committed to accelerating market rebalancing without delay,” said Edward Moya, senior miner. market analyst at OANDA.
The Organization of the Petroleum Exporting Countries (OPEC) and allies, known as OPEC +, expanded the conventional oil production policy at Wednesday’s meeting, a sign that producers are pleased that their deep supply cuts are draining investments despite a view uncertain to overcome in demand as crown pandemic disease.
Oil has accumulated from historic levels last year, thanks to record OPEC + output cuts that the group is starting to empty.
Also supporting prices, U.S. crude oil stocks fell 994,000 barrels last week to 475.7 million barrels, their lowest level since March, the U.S. Energy Information Administration said Wednesday. Analysts in a Reuters poll had forecast a 446,000-barrel increase.
While brewing consumption rates rose 0.6 percentage points to 82.3% of capacity, U.S. gasoline stock rose 4.5 million barrels, the EIA said.
Continued progress in the distribution of COVID-19 vaccines is also an important driver of oil prices, Moya said OANDA.
“There are a number of effective COVID vaccines in the world that should really force energy traders to return to predicting pre-pandemic behavior,” he said.
Reporting by Jessica Jaganathan; Edited by Kenneth Maxwell