Russia Could Cut Oil Production at Faster Pace - Energy Minister Novak
- Author: Wendy Palmer Feb 05, 2017,
Feb 05, 2017, 1:11
But indications that producers from the Organization of the Petroleum Exporting Countries and others including Russian Federation are curbing output helped underpin prices.
Supply concerns were also raised when Russia's energy minister said global oil output was cut by 1.4 million barrels per day (bpd) last month as part of the deal a year ago between OPEC and other producers.
Being on a visit to Hungary with the Russian delegation led by President Vladimir Putin, Novak declined to reveal a possible scale of oil output cut in February.
Brent crude, the global oil benchmark, rose 0.9% to $57.32 a barrel on London's ICE Futures exchange.
Oil production at Rosneft, Russia's largest oil producer, stood at 518,000 tonnes per day (3.8 million bpd), down from 520,400 tonnes per day in December.
The Organization of Petroleum Exporting Countries pumped 32.3 million barrels a day in January, according to a Bloomberg News survey of analysts, oil companies and ship-tracking data.
The only good news on Thursday was the perception that traders "have concluded the dispute between the USA and Iran over a recent missile test represents more of a war of words than the start of a military confrontation that would put supplies from the wider Persian Gulf at risk", according to Tim Evans, energy futures specialist for Citi Futures.
Also feeding into trading sentiment was government data released on Wednesday which showed that U.S. inventories of crude oil rose by 6.5 million barrels to 494.8 million barrels in the week ended January 27, according to the Energy Information Administration's (EIA) weekly oil report.
"With data now coming out for the first month affected by the OPEC and non-OPEC output cuts, it appears fairly safe to say that compliance with the pledged reduction has been relatively high", analysts at JBC Energy said in a report.
Higher crude prices in recent months have prompted US energy producers to drill for more oil.
Tensions have escalated between the U.S. and Iran after Tehran tested a ballistic missile.
US gasoline futures fell 2.9 percent. "U.S. production will be bigger than most people are expecting".