Oil ends up, OPEC cut commitments assuage lingering doubts

Thu Oct 27, 2016 4:26pm EDT
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By Ethan Lou

NEW YORK (Reuters) - Oil settled higher on Thursday, as commitments from Gulf OPEC members to cut production assuaged some lingering doubts in the market about cooperation from other producers.

The international benchmark Brent crude LCOc1 was up 49 cents, or 1 percent, at $50.47 a barrel.

U.S. West Texas Intermediate crude CLc1 gained 54 cents, or 1.1 percent, to $49.72.

"Another day, another market being pushed and prodded around by OPEC rhetoric," said Matt Smith, director of commodity research at energy data provider ClipperData.

Energy ministers from Saudi Arabia and Gulf allies told their Russian counterpart this week they are willing to reduce peak oil output by 4 percent, sources familiar with the matter said.

The Organization of the Petroleum Exporting Countries (OPEC) said last month it would restrain output to boost prices, which have been slumping at less than half their mid-2014 levels due to a persistent supply glut.

Iraq, however, has called for an exemption, adding to the list of members seeking special treatment. The expectation was that Libya, Nigeria and Iran should be exempt as their output had been hit by wars and sanctions, OPEC sources said.

Smith noted that overall OPEC exports have been rising, which would normally be bearish for the commodity.   Continued...

A pump jack operates at a well site leased by Devon Energy Production Company near Guthrie, Oklahoma September 15, 2015.    REUTERS/Nick Oxford