Oil prices have slightly risen following a sharp decline in the US crude stocks, with the market awaiting further steps from a technical meeting on the next level of output cuts by OPEC and its allies.

Brent crude futures were up by $0.19 at $43.09 per barrel while US West Texas Intermediate (WTI) crude futures increased $0.17 to reach $40.46 a barrel, Reuters reported.

Data released by industry group the American Petroleum Institute (API) highlighted a decrease in the US crude stockpiles by 8.3 million barrels in the week that ended on 10 July.

This reflected a recovery in fuel demand despite the Covid-19 outbreak.

Official data by the US Department of Energy’s (DoE) Energy Information Administration (EIA) are due to be released today.

At the OPEC’s Joint Ministerial Monitoring Committee (JMMC) meeting to be held later today, a decision will be taken either to extend output cuts of 9.7Mbpd that would end this month or ease them to 7.7Mbpd.

Reuters quoted ING Economics as stating in a note: “API numbers released overnight, have provided some support to the market in early morning trading today.

“The market will be eager to see if deeper cuts will be rolled over for an additional month, or whether the group will stick to the original plan, and start trimming cuts.

“Most indications suggest that it will be the latter, with more focus on compliance and compensatory cuts.”

Oil prices have recovered after the Organization of the Petroleum Exporting Countries (OPEC), Russia and allies, together known as OPEC+, has been reducing supply by approximately 9.7Mbpd since 1 May.

Last month, the group also agreed to extend output cuts until the end of this month.

Under the existing agreement, the group is set to restrict supply cuts to 7.7Mbpd from August through December.

Reuters cited an OPEC+ source as saying that OPEC and its allies delivered 107% compliance with their agreed supply cuts.