Oil prices marginally gain as Saudi Arabia plans to cut exports
Oil prices have gained marginally after reports of lower crude supplies from Saudi Arabia set to start next month negated the impact of the ongoing high output from prominent exporters, including the US.
Benchmark Brent crude gained 5 cents to touch $52.42 a barrel, while the US light crude traded at $49.49 climbing 10 cents, reported Reuters.
Denmark's Saxo Bank commodity strategy head Ole Hansen was quoted by the news agency as saying: “Support is coming from a stabilising US rig count, falling US inventories and the Saudi cut in exports.”
An official familiar with the matter told Reuters that Saudi Arabian state oil company Aramco will decrease designated customer allocation next month by nearly 520,000 barrels per day (bpd).
The reduction in exports complies with Saudi Arabia’s previously stated proposal to decrease allocations that will support the ongoing initiative of the supply reduction pact led by the Organization of Petroleum Exporting Countries (OPEC) to revive oil prices.
However, production remained high in various parts of the world as oil continued to be traded at nearly half the level of its 2011-2014 prices.
The Sharara oil field in Libya that produces about 270,000bpd also resumed output following a disruption, the National Oil Corporation of the country said.
Libya, an OPEC member, is exempted from the OPEC deal to curb oil production.