Oil prices edged up, adding up to the recent rally to hover near eight-week highs in the prior session on bets of a drawdown in U.S. inventories and as an increase in shale oil production shows signs of slowing.
Brent crude futures rose 0.6 percent to $50.52 per barrel after advancing over 3 percent. U.S. WTI advanced 42 cents or 0.9 percent to $48.31 per barrel.
U.S. crude stocks showed a sharp decline last week as refineries bolstered output, while gasoline inventories rose and distillate stocks fell, according to the American Petroleum Institute.
Crude inventories declined by 10.2 million barrels in the latest week ending July 21 to 487 million, significantly better than the expected decline of 2.6 million barrels.
Sentiment in the market has been lifted by Saudi Arabia’s announcement at an OPEC and non-OPEc meeting that will reduce exports to 6.6 million bpd in August, almost 1 million bpd from a year prior.
Nigeria has also agreed to participate in the deal by limiting or reducing its production from 1.8 million bpd once it consolidates at that level.
The material has been provided by InstaForex Company – www.instaforex.com