Oil prices climb on expected drop in US crude stocks
Oil markets rose in early Asian trade on Tuesday, buoyed by expectations of a drop in US crude stockpiles and after last week's deal between OPEC and other crude producers to extend output curbs.
International benchmark Brent crude futures were up11 cents from their last close, or 0.18%, at $62.56 per barrel by 0129 GMT. US West Texas Intermediate (WTI) crude futures were up 15 cents, or 0.26%, at $57.62 per barrel.
The Organisation of 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, looking to erode a global glut and drive up prices.
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 $57.5 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. While rising US oil production remains a hurdle for OPEC's efforts to rebalance the market, US crude inventories likely fell last week, marking their third straight weekly drop, a preliminary Reuters poll showed.
Seven analysts polled ahead of inventory reports from the industry group American Petroleum Institute (API) and the US Department of Energy's Energy Information Administration (EIA) estimated, on average, that crude stocks were seen falling 3.5 million barrels in the week ended December 1.
Official government inventory data is due on Wednesday at10:30 a.m. EDT (1430 GMT)