On Monday, oil prices dropped as investors anticipate figures from OPEC later this week, which will give additional awareness into demand and supply movements.
On Tuesday, oil markets were mixed, supported by development in U.S. crude output and Saudi Arabia said it would strictly follow to a commitment to reduce production, but held back by doubt in financial markets that glut would be curbed.
In an effort to clear a global glut that has depressed prices for more than two years, The Organization of the Petroleum Exporting Countries (OPEC) has settled to reduce production by 1.2 million barrels per day (bpd) to 32.5 million bpd from Jan. 1.
Russia and other key exporters outside the Organization of the Petroleum Exporting Countries (OPEC) have stated they will also cut production.
However, investors have questioned that the Organization of the Petroleum Exporting Countries (OPEC) and its partners can trim production enough to drive up prices.
This Wednesday, January 18, OPEC releases its monthly output data, offering early indications on the agreement signed late in 2016.
On the NYMEX, delivery of crude oil futures in February declined 12 cents, or 0.2 percent, to $52.25 a barrel.
Benchmark Brent crude oil increased 41 cents a barrel, or 0.7%, at $55.86 and U.S. West Texas Intermediate crude increase 27 cents, or 0.5%, to $52.64 a barrel.
The analyst believes that for the first quarter of 2017, the price of oil will be about the $55 a barrel-mark, until the real effect of the reductions are felt. Others offer hope for $60 per barrel.
However, anticipations of increasing oil production in the United States, along with the U.S. federal holiday on Monday capped price gains.
Goldman Sachs stated it anticipates YoY U.S. oil output to increase by 235,000 barrels per day in 2017, take into consideration wells that have been drilled and are expected to begin producing in the first half of the year.
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