Economy

Oil Price Rises as OPEC Sticks to Output Pledges

Published

7 years ago

March 2, 2017

The Nigerian economy has been handed the needed boost with an increase in the price of oil in the international market.

Oil reversed earlier losses, yesterday, as investors took heart from strict Organisation of the Petroleum Exporting Countries, OPEC, compliance with its pledge to cut output.

OPEC reduced its oil output for a second month in February, a media survey found, showing the exporter group has boosted already strong compliance to around 94 per cent.

Heftier cuts by Saudi Arabia and Angola helped offset weaker compliance by other members that agreed to limit their output.

May Brent crude futures were last up 27 cents at $56.78 a barrel by 1030 GMT, while US West Texas Intermediate (WTI) futures for April were up 18 cents at $54.19.

Oil prices are 23 per cent higher than they were at the end of November, when OPEC announced its deal, but this strength has encouraged more US production to come back online.

“There seems … to be a consensus within OPEC that the optimal crude oil price is as near as possible to the upper line of our shale band price range…,” Olivier Jakob, a strategist at consultant Petromatrix said.