Light, sweet oil prices for March settled above $54/bbl on the New York market Feb. 21 and the Brent contract for April settled above $56.60/bbl on the London market. Crude oil prices rallied as trading resumed in New York after the Feb. 20 US Presidents Day holiday.
The Organization of Petroleum Exporting Countries Sec.-Gen. Mohammad Barkindo spoke to participants attending International Petroleum Week in London. He cited at least 90% compliance among cartel members involved in an agreement to curtail production. He sees the compliance likely to grow.
Barkindo noted that 100% compliance from OPEC producers is needed, stressing that the need for production cuts given the high level of global oil stockpiles.
Delegates attending the conference were asked to forecast oil prices a year from now. About 45% said Brent crude will trade in $50-59/bbl range while 33% forecast Brent will trade in a higher range of $60-69/bbl.
Meanwhile, US benchmark prices have traded within a range of $50-55/bbl since OPEC started implementing the production cuts in January.
Analysts note rising US oil production could slow attempts by major OPEC and some non-OPEC producers to reduce oil supplies worldwide.
The American Petroleum Institute was scheduled to release its estimate of US crude inventories on Feb. 22. The more closely watched inventory report from the US Energy Information Administration was scheduled for release on Feb. 23, a day later than usual because federal offices were closed Feb. 20 for Presidents Day.
US natural gas futures for March delivery fell 27¢ to a rounded $2.56/MMbtu, marking its lowest settlement level since Aug. 11, 2016, according to Dow Jones statistics. Warmer weather and less demand for gas-fired heating was blamed for the price drop. The spot gas price at the Henry Hub in Cushing, Okla., closed at $2.52/MMbtu, down 23¢ from the previous trading session’s settlement.