Oil prices have traded higher amid hopes of a fall in US crude oil inventories.

Brent crude oil futures LCOc1 traded at $55.56 per barrel, growing by 21 cents, while US crude futures CLc1 were up by 25 cents to reach $53.55 a barrel, reported Reuters.

Higher oil prices were primarily due to expectations of reduction in US crude stocks. However, analysts suggested that this may not continue in the long-term.

PVM Oil Associates analyst Stephen Brennock was quoted by Reuters as saying: “Oil seems determined to end the year on a high note. Pre-holiday thinned trading and a fresh 14-year high for the dollar index failed to dampen bullish spirits.”

US crude inventories dipped for the fifth consecutive week by 2.5 million barrels.

The US Energy Information Administration will release the final data shortly.

French Bank Societe Generale opined that crude oil price range may hover from $50-$60 to $40-$50 a barrel following OPEC and Russia's decision to cut output by approximately 1.8 million barrels daily.

Overall, prices are likely to remain low globally next year.

This year, Russia’s oil production is expected to touch 547.5 million tonnes, which is a 2.5% increase over 2015 production.

Image: OPEC and Russia agreed to cut output. Photo: courtesy of Stuart Miles/ FreeDigitalPhotos.net.