Oil prices have stabilised after OPEC’s report indicated that efforts to cut production have been moderately successful.

Brent crude futures LCOc1 and US West Texas Intermediate (WTI) crude CLc1 both gained 4 cents since their last close to get traded at $55.63 per barrel and $52.97 a barrel respectively, reported Reuters.

Both oil benchmarks swayed within a $5 per barrel range from the beginning of this year.

Last year OPEC countries decided to reduce oil production by nearly 1.8 million barrels per day for the first six months of this year to end global oil glut.

Various non-OPEC nations including Russia also committed to reduce their output.

"Oil just appears to be caught in a range at the moment and mainly focused on those supply considerations."

However, US shale oil producers increased their drilling activity to raise overall output to 8.98 million bpd, undermining the OPEC efforts.

CMC Markets chief market analyst Ric Spooner was quoted by the news agency as saying: “Oil just appears to be caught in a range at the moment and mainly focused on those supply considerations.”

Although OPEC stated it had achieved a 90% compliance rate, it needs to increase the output-cut in the coming months to fulfill the targets.

ABN has reduced its oil price forecast to $50 from $55 per barrel.


Image: An offshore oil rig. Photo: courtesy of Vee TEC/ FreeImages.com.