Oil Rises Strongly Supported by Cuts, Sanctions

Brent oil price exceeds $68 first since November

EIA: The US imports and exports substantial volumes of petroleum

According to Reuters, now the Iraqi state oil marketing company is also emboldened to trade the Iraqi crude on its own as the market for sour and heavy crude grades is tightening amid OPEC's cuts and the us sanctions on Iran and Venezuela.

The cost of the futures contracts of Brent crude oil for May 2019 delivery gained 0.71% amounting to $68.03 per barrel on London's ICE as of 11:10 a.m. Moscow time today, according to the trading data. The increase in refinery output of petroleum products has outpaced the increase in United States consumption of petroleum products such as distillate fuel oil, gasoline, and propane, leading to an increase in exports.

In a monthly report, the Organization of the Petroleum Exporting Countries said 2019 demand for its crude would average 30.46 million barrels per day, 130,000 bpd less than forecast last month and below what it is now producing. Other factors that have been influencing oil prices include the current blackout in Venezuala alongside the state of the ongoing trade talks between Washington and Beijing.

OPEC, Russia and other non-member producers, an alliance known as Opec+, are reducing output by 1.2 million bpd from January 1 for six months.

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Opec sources have said an extension of the pact is the likely scenario.

"U.S. crude oil exports have set annual record highs in each year since 2014", said EIA.

Crude oil production in the country also fell by 106,000 barrels per day (bpd) to around 12 million bpd, the data showed. "USA sanctions on Venezuelan petroleum products have cemented support for oil prices", said Benjamin Lu of Singapore-based brokerage Phillip Futures. It kept its forecast for growth in global oil demand this year unchanged at 1.24 million bpd. "Gasoline inventories drew strongly, now down more than 12 million barrels-or 5%-in four weeks, while distillate inventories ticked higher as implied demand slipped last week". Brent touched $67.39 a barrel on Monday, its highest since February 25.

Sources said Novak would be there on Sunday, along with Saudi Energy Minister Khalid Al Falih. WTI hit a high of $58.48 a barrel on Wednesday, the highest since November 13.

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