US oil prices dipped on Thursday after USA crude inventories rose and as production levels in the country stayed at record levels, but OPEC-led supply cuts and the crisis in Venezuela supported markets. The government's official supply report is due later on Wednesday.
Oil prices mostly held earlier losses on Wednesday after weekly US government data showed an increase in crude stockpiles.
West Texas Intermediate crude for March delivery slipped 0.4 percent to $53.81 a barrel on the New York Mercantile Exchange as of 10:50 a.m. London time.
Oil slips below $62 on rise in US inventories
Global benchmark Brent crude dropped almost 1% to $61.39 a barrel while WTI futures were down more than 1% at $53.12 a barrel. At 447.2 million barrels, the EIA said , us crude oil inventories are still above the seasonal average but not by much.
John Kilduff, an energy hedge fund manager in NY who's familiar with Russia's oil industry, said earlier this week that while Moscow had committed to production cuts with OPEC to boost crude prices, it was unlikely to get any deeper into the cartel's game for fear of jeopardizing its own oil market share in the long run.
The sanctions will sharply limit oil transactions between Venezuela and other countries and are similar to those imposed on Iran past year, experts said after examining details posted by the Treasury Department. "Additionally, the builds in crude (+1.3 million barrels) and gasoline stocks (+0.5 million barrels) were less than anticipated".
Concern about weaker global economic growth and the trade dispute between the United States and China have also weighed on sentiment.
Market participants have already been focused on signs of tightening global crude supply after the Organization of the Petroleum Exporting Countries (OPEC) and allies began an agreement in January to cut output.
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Venezuela, like fellow OPEC members Iran and Libya, was exempt from production curbs under the OPEC+ deal on expectations that its output faced involuntary downward pressure in 2019.
A formal OPEC+10 joint structure, as suggested in the WSJ report earlier this week, would only lead to additional red tape and the risk of USA sanctions against monopolies, Novak added, TASS said.
Saudi Arabia, the world's top oil exporter, told OPEC it had pumped 10.24 million barrels per day (bpd) in January, two OPEC sources told Reuters, a deeper cut than targeted in the supply pact. "Moreover, lower oil prices - prices were between 14% and 18% lower in January than their 2018 average - are likely to stimulate economic activity and oil demand, particularly in emerging markets", said Jean-Pierre Durante, Head of Applied Research at Pictet Wealth Management.
"Anything out of the State of the Union that hints at the U.S".
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The oil price is showing a 20 percent gain so far this year.