Oil Prices Edge Higher as Saudi Arabia to Extend Output Cuts

Investing.com – Oil prices edged higher on Monday, following reports that will extend deep supply cuts into April, as the kingdom seeks to drain a supply glut.

U.S. futures for April delivery on the New York Mercantile Exchange rose 31 cents, or around 0.55%, to $56.38 a barrel by 8:40AM ET (12:40 GMT).

Elsewhere, for May delivery on the ICE (NYSE:) Futures Exchange in London tacked on 50 cents, or about 0.75%, to $66.23 a barrel.

Saudi Arabia plans to cut its crude oil exports in April to below 7 million barrels per day (bpd), while keeping its output “well below” 10 million bpd, a Saudi official said.

“This will keep production well below 10 million bpd in April,” the official said, adding that this is also below the 10.311 million bpd that the kingdom has agreed as its production target under an OPEC-led supply cut agreement.

Prices were also supported after Saudi oil minister said that an end to OPEC-led supply cuts was unlikely before June. Al-Falih told Reuters on Sunday it would be too early to change OPEC+ output policy at the group’s meeting in April.

OPEC and other producers such as Russia, colloquially known as OPEC+, agreed in December to reduce supply by 1.2 million bpd from Jan. 1 for six months.

The group will meet in Vienna on April 17-18, with another gathering scheduled for June 25-26, to discuss supply policy.

Gains were held in check as investors remained cautious over a possible global economic slowdown after important data in the U.S. and China missed expectations last week.

The U.S. and China are the world’s two largest oil consuming nations.

In other energy trading, added 0.9% to $1.819 a gallon, while was little changed at $2.000 a gallon.

sank 2.9% to $2.782 per million British thermal units.

— Reuters contributed to this report

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