Oil up on continued disruptions

LONDON, December 18, 2017 – Crude oil prices were higher on Monday, as sustained supply disruptions in the North Sea and Nigeria continued to support the commodity despite ongoing concerns over rising U.S. production levels.

The U.S. West Texas Intermediate crude January contract was up 5 cents or about 0.09% at $57.38 a barrel by 09:50 a.m. ET (13:50 GMT).

Elsewhere, Brent oil for February delivery on the ICE Futures Exchange in London was up 17 cents or about 0.27% at $63.40 a barrel.

Ongoing supply disruptions from the Forties pipeline in the North Sea continued to lend support to the commodity.

 

In addition, a strike by Nigerian oil workers also sparked concerns over exports from Africa’s largest crude producer.

Prices received an additional boost after energy services firm Baker Hughes said on Friday that U.S. energy companies cut rigs drilling for new production for the first time in six weeks, to 747, in the week ended December 15.

Fears that rising U.S. output would dampen OPEC’s efforts to rid the market of excess supplies have been recently weighing on sentiment, according to market participants.

The producer group, along with some non-OPEC members led by Russia, agreed last week to extend current oil output cuts for a further nine months until the end of 2018.

The deal to cut oil output by 1.8 million barrels a day (bpd) was adopted last winter by OPEC, Russia and nine other global producers. The agreement was due to end in March 2018, having already been extended once.

Elsewhere, gasoline futures were up 0.82% at $1.668 a gallon, while natural gas futures were up 4.67% at $2.740 per million British thermal units.

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