Global oil prices have risen due to a continuing outage at the North Sea Forties pipeline system and signs of a potential slowdown in US crude output growth.
US West Texas Intermediate (WTI) crude futures CLc1 were trading at $57.67 a barrel, recording a rise of 37 cents, or 0.65%, while Brent crude futures LCOc1, jumped 44 cents, or 0.7%, trading at $63.67 a barrel, according to Reuters.
Last week, Ineos declared force majeure on all oil and gas shipments through its Forties pipeline system after cracks were identified during a routine inspection.
Energy consultancy Trifecta director Sukrit Vijayakar was quoted by the news agency as saying: “The force majeure … is acting as a major prop for crude.”
For the first time in six weeks, US energy companies cut rigs drilling for new production to 747 in the week ending 15 December, according to Baker Hughes.
Even after the scaling down of drilling activity, the figure is still well above the rig count of less than 500, registered around the same period last year.
US production has increased to 9.8 million barrels per day, which represents a 16% rise since mid-2016 levels, continuing to be a major influence on prices and posing a challenge to OPEC-led efforts to tighten the market.
Based on data from the International Energy Agency (IEA), global oil markets are expected to witness a slight supply surplus of around 200,000bpd during the first half of next year.