Oil Prices Steady Amid Possibility of Deeper Supply Cuts

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© Reuters.

By Alex Ho

Investing.com – steadied on Friday in Asia amid possibility of deeper supply from major producers.

U.S. inched up 0.1% to $51.48 by 12:30 AM ET (04:30 GMT). International was little changed at $56.35.

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The Organization of the Petroleum Exporting Countries (OPEC) lowered its 2020 demand forecast for its crude by 200,000 barrels per day, citing worries about the coronavirus outbreak in , the world’s biggest oil importer.

The news prompted expectations the producer group could cut output further.

“The Russians have pretty much signaled that everyone is on board for OPEC+ delivering deeper production cuts,” said Edward Moya, senior market analyst at OANDA in New York, in an Al Jazeera report.

“Crude’s price action possibly suggests a firm bottom is in place. As long as the coronavirus does not show strong signs that the spreading of the virus is intensifying, WTI crude could make a run towards the mid-$50s,” Moya added.

The , meanwhile, estimated a drop of 435,000 barrels a day during the first three months of the year. It had previously expected world fuel consumption to grow by 800,000 barrels a day compared with a year earlier.

The expected decline in demand prompted the agency to cut its 2020 growth forecast by 365,000 bpd to 825,000 barrels a day, the lowest since 2011.

Oil have slumped about 20% from their peaks in early January as from China plunged due to travel restrictions to and from the country.

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Source: Investing.com

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