Oil prices climb higher ahead of US oil inventory data and on the OPEC oil output cut agreement. Will the deal be implemented?
5 October, AtoZForex – Oil futures prices rose in early Asian trade on Wednesday, headed higher as investors still evaluating the odds of the Organization of the Petroleum Exporting Countries (OPEC) deal implementation and ahead of the US oil inventory data.
Oil prices climb higher
November light, sweet crude climbed 46 cents or 0.9 percent to $49.15 per barrel in the Globex electronic session, where Brent crude rose 0.8 percent or 43 to $51.30 a barrel. The prices have been soaring last week on the oil output cut deal. The analyst at Citigroup wrote in a note to the clients:
“Until last week, the market was operating under an assumption that OPEC had effectively ceased to be. Last week, it showed signs of life.”
Market experts say the agreement ‘is not a game-changer, in our view, given the uncertainties and skepticism around any cuts to production.” Yet they noted that the deal raises the floor under the per-barrel trading range from “the low $40s … to the mid-$40s.”
See also: Daily USDCAD & GBPUSD technical analysis
OPEC agreed on cutting the oil output to between 32.5 million and 33 million barrels a day. Further discussion of the agreement details is planned to take place during OPEC’s meeting in November.
US oil stockpiles diminished
Currently, as Oil prices climb higher, investors are expecting the US oil inventories data from the US Department of Energy. The American Petroleum Institute stated that its own inventory survey for the last week identified a decrease of 7.6 million barrels in the US oil stockpiles. As for the gasoline inventories, they increase 2.9 million barrels, where distillate stockpiles diminished 1.3 million barrels.
The New York Mercantile Exchange figures show that November gasoline rose 0.1 percent to $1.501 per gallon, where November diesel climbed 1.17 cents to $1.5661 a gallon.
Think we missed something? Let us know in the comments section below.