Reuters – Oil prices inched lower on Tuesday ahead of US crude inventories data, as the market weighed the impact of rising US crude output versus last week’s deal between OPEC and other crude producers to extend output curbs.
International benchmark Brent crude futures were trading down 0.13%, at $62.37 per barrel by 0732 GMT.
The Organisation of the Petroleum Exporting Countries (OPEC) and non-OPEC producers last week rolled over their agreement to cut output by 1.8 million barrels per day (bpd) until the end of 2018, aiming to erode a global glut and drive up prices.
Although the world’s major oil producers reached an agreement last week, Kazakh Energy Minister Kanat Bozumbayev said on Tuesday that complying with the global oil output cut deal will be complicated for Kazakhstan, one of the non-OPEC members who supported the pact.
Goldman Sachs said Saudi Arabia and Russia showed a stronger commitment to extending cuts and raised its Brent and WTI spot forecasts for 2018 to $62 and $57.50 per barrel respectively.
“By 2019, however, we believe the response of shale and other producers to higher prices will incentivize OPEC and Russia to pare back their now greater spare capacity, leaving risks to prices skewed to the downside,” the bank added.
In November, OPEC crude oil output fell by 300,000 bpd to its lowest since May, according to a Reuters survey released on Monday.