SINGAPORE Feb 10 Oil prices were stable early
on Friday, with OPEC-led production cuts supporting the market
while soaring U.S. fuel inventories were weighing on crude.
U.S. West Texas Intermediate (WTI) crude futures were
trading at $53.08 per barrel at 0106 GMT, up 8 cents from their
Brent crude futures, the international benchmark for
oil prices, were up 3 cents at $55.66 a barrel.
Both crude futures have traded within a $5 range since the
beginning of the year, and traders said this was due to
competing price drivers.
"Oil prices continue to struggle to break out of the current
range," ANZ bank said on Friday.
"The push and pull between competing forces in the crude oil
market continued overnight. Despite the stronger U.S.-dollar
and lingering concerns about U.S. (oil) inventories,
traders returned their focus to the OPEC production cuts being
implemented at the moment," it added.
The Organization of the Petroleum Exporting Countries (OPEC)
and other producers including Russia have agreed to cut output
by almost 1.8 million barrels per day (bpd) during the first
half of 2017 in a bid to rein in a global fuel supply overhang.
There was widespread scepticism that all producers would
actually make the promised cuts, but compliance with the
announced reductions is now estimated to be between 80 and 90
percent as especially OPEC's de-facto leader Saudi Arabia has
enforced sharp production cuts.
And this is likely to remain until the release of OPEC data
Despite this, oil markets remain bloated as inventories
especially in the United States are brimming and rising U.S.
drilling activity is pushing up production there as well.
As a result, WTI and Brent crude oil futures are 4 to 5
percent below their early January peaks.
(Reporting by Henning Gloystein; Editing by Joseph Radford)