Crude Oil Prices Settle Higher as OPEC Says Excess Crude Supplies Nearly Gone

Investing.com – Crude oil prices settled higher on Monday as traders cheered a mostly bullish report from OPEC showing excess stockpiles of global crude has been nearly eliminated.

On the New York Mercantile Exchange for June delivery rose 26 cents to settle at $70.96 a barrel, while on London’s Intercontinental Exchange, rose 1.12% to trade at $77.98 a barrel.

In its monthly report on Monday, OPEC said its production rose by 12,000 barrels per day to 31.9 million barrels per day in March. While oil inventories in developed nations fell to 9 million barrels above the five-year average. That’s down from 340 million barrels above the average in January 2017.

The fall in crude supplies come as the oil cartel remained commitment to the output-cut agreement while a slump in Venezuelan oil output also slashed global crude inventories.

OPEC raised its forecast for 2018 global oil demand to 98.85 million barrels a day, an increase of 25,000 barrels, compared with the previous estimate.

Concerns over the ramp up in non-OPEC output continued, however, as the oil cartel estimated non-OPEC supply in 2018 to grow by 1.7 million barrels per day, with nearly 90% coming from the United States.

U.S. production showed no signs of abating, however, as data from Baker Hughes on Friday showed the number of oil rigs operating in the US rose by 10 to 844, its highest level since March 20, 2015.

The positive start to the week for oil prices comes as elevated Middle East tensions continued to support traders’ bullish bets on a disruption to global crude supplies following the United States’ decision to pull out of the Iran nuclear deal last week.

OPEC signalled the group and its allies were ready to step in should geopolitical developments impact supply.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.