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United States crude oil inventories are still above historic norms — CHART
US plan to sell oil reserves undermines OPEC supply management efforts
June 26 2017, 12:05 | Clarence Walton
India, which has repeatedly pressed OPEC members for oil price stability, has offered staff and other technical assistance to Aramco, Pradhan said.
This is because OPEC's oil supplies in 2017 have so far not actually fallen when compared with previous year, when oversupply was seen at its worst.
Dharmendra Pradhan made the comments in Vienna ahead of OPEC's meeting this Thursday when members will decide whether to extend production cuts to ease the global oil glut that has grown in tandem with rising North American output.
Parties to a multilateral effort to offset the high level of crude oil supplies on the market through managed production declines meet in Vienna later this week to review the terms of the arrangement. Al-Luaibi had previously said that Iraq would support a six-month extension.
OPEC members and Russian Federation will meet on Thursday and are expected to extend the production cut agreement. President Trump roiled those tensions this week on his trip to Saudi Arabia, when he accused Iran of fomenting regional instability by supporting militias that "spread destruction and chaos".
Saudi Energy Minister Khalid al-Falih flew to Baghdad to hold discussions with his Iraqi counterpart, Jabar al-Luaibi, on Monday.
Oil has climbed as OPEC's de-facto leader Saudi Arabia and non-OPEC member Russian Federation backed a nine-month extension to the output-cut deal reached in late 2016.
EUR/USD pushed to fresh 6-month highs near 1.1250 ahead of the US open with the weak dollar providing further net support to oil prices.
Both benchmarks slipped back from near session highs after a report that USA energy companies added oil rigs again in the latest week, Kallanish Energy learns.
"Oil prices react positively to news flow before the summit of OPEC may 25, traders expect the extension of the agreement for a further six to nine months and possibly additional increased reduction of production", says senior Manager for research and analysis of industries and capital markets PSB Ilya Frolov.
"Time and again they are rebuilding long positions", he said.
OPEC rhetoric will be monitored closely with the most important element likely to be whether there is any momentum towards deeper production cuts.
"I don't accept that Saudi Arabia or any other countries should pick up the slack from others", he said.
US oil production has already climbed by 10 percent, or nearly 900,000 bpd, since mid-2016 to 9.3 million bpd.
The U.S. oil-rig count, an indicator of activity in the sector, rose by 8 to 720, according to weekly data published by Baker Hughes Inc (http://www.marketwatch.com/story/baker-hughes-reports-18th-straight-weekly-rise-in-the-us-oil-rig-count-2017-05-19).(BHI) Friday.