Oil prices stabilises on expectations of extended output cut

Oil prices stabilised on Thursday on expectations that Saudi Arabia and Russia would extend production cuts, although record US exports dragged on the market.

Brent crude futures LCOc1, the international benchmark for oil prices, were at $55.89 per barrel at 0259 GMT, up 9 cents, or 0.16 per cent, from their previous close.

Russian President Vladimir Putin said on Wednesday that a pledge by the OPEC and other producers to cut oil output to boost prices could be extended to the end of 2018, instead of expiring in March 2018.

The statement came ahead of a visit by Saudi Arabia’s King Salman to Moscow, reports Reuters.

The pact on cutting output by about 1.8 million barrels per day (bpd) took effect in January this year.

In the United States, West Texas Intermediate (WTI) crude futures CLc1 were weaker, trading at $49.97 per barrel, down 1 cent from their last close.

That came after the Energy Information Administration (EIA) said late on Wednesday that US crude oil exports jumped to 1.98 million bpd last week, surpassing the 1.5 million bpd record set the previous week.

The increase has been triggered by the wide discount in US WTI prices against international Brent crude prices, which makes US oil exports attractive.