OPEC-led supply cuts continue to support oil prices. Credit: drpepperscott230 from Pixabay.

Oil prices have improved, driven by ongoing supply cuts led by oil cartel Organization of the Petroleum Exporting Countries (OPEC).

International Brent crude oil futures climbed 13 cents to $67.74 per barrel while US West Texas Intermediate (WTI) crude futures stood at $59.07 per barrel, gaining 4 cents, reported Reuters.

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Overall crude prices have climbed by nearly a third, primarily due to supply cuts by OPEC member nations.

The OPEC member countries, along with other key participants, agreed to withhold production by about 1.2 million barrels per day (bpd) to support falling prices.

The prices were supported by recent US sanctions against major oil producers Iran and Venezuela.

“The shaky supply outlook with regard to Venezuela and Iran and the petro-nations’ output restrictions are top of mind in the oil market.”

Swiss bank Julius Baer economics head Norbert Ruecker was quoted by Reuters as saying: “The shaky supply outlook with regard to Venezuela and Iran, as well as the petro-nations’ output restrictions are top of mind in the oil market.”

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However, analysts opine that global economic slowdown may reduce fuel demand, which in turn will affect oil prices adversely. Industry group the American Petroleum Institute reported that the US crude, gasoline and distillate stock dropped in the week to 15 March 2019.

The data, if confirmed by the official weekly count by the US Energy Information Administration (EIA), may support global prices.

London Capital Group research head Jasper Lawler told Reuters: “A surprise draw in crude oil inventories… could lift (WTI) crude towards the elusive $60 per barrel. A level that hasn’t been breached so far this year.”