Crude oil prices rose on Monday following comments by the Saudi energy minister Khalid Al-Falih that the end of supply cuts by the Organization of Petroleum Exporting Countries (OPEC) is unlikely to happen before June. At the same time, the drilling activity in the US is shrinking.
The futures on US crude oil WTI appreciated by 0.61% to 56.41 USD per barrel, while Brent variety reports a price increase of 0.58% to 66.12 USD per barrel.
The upward trend, however, is limited by recent employment data in the United States, which raise concerns that shrinking the economy in Asia and Europe is spreading to the US.
The crude oil markets are generally supported by the continued supply cuts by the OPEC and some non-cartel countries, including Russia. OPEC+ has committed itself to cut supplies by 1.2 million barrels per day since the beginning of the year to tighten markets and support prices.
The organization will meet in Vienna on April 17 and 18 to discuss its supply policy. The next meeting will be June 25-26.
The crude oil prices are backed by Baker Hughes’s latest weekly report, which shows that the number of drilling platforms in the US has dropped 9 to 834.
High drilling activity last year led to a production increase of over 2 million barrels per day to 12.1 million barrels per day reached in February. This made the United States the world’s largest producer of crude oil after Russia and Saudi Arabia.