OPEC and other oil producers taking part in output cuts have reached a consensus to extend the limits until the end of the year, oil ministers for two of the group's members said.
"Higher oil production from the United States, along with rising oil output from Canada and Brazil, is expected to curb upward pressure on global oil prices through the end of 2018", EIA Acting Administrator Howard Gruenspecht said in a statement, reports CNBC.
Saudi Arabia's energy minister Khalid Al-Falih said on Monday oil markets were rebalancing after years of oversupply, but that he still expected the OPEC-led deal to cut output during the first half of the year to be extended.
Saudi Aramco has told Asian buyers it is curtailing supplies for June to meet its commitments for the output cut, one of the sources at a refiner in South Korea said.
NEW YORK, May 11 (Reuters) - Oil prices rose more than 1 percent on Thursday, as large drawdowns in US inventories and growing support for continued OPEC output cuts boosted confidence that a seemingly insurmountable glut might finally diminish.
But after Brent prices fell back below $50 per barrel last week, analysts said producers felt forced to act.
Oil rose on Tuesday but faced headwinds from concern over slowing demand and the rise in USA crude output that has shaken investors' faith in the ability of OPEC to rebalance the market.
The news agency reported that state-owned Saudi Aramco will reduce oil supplies to its Asian customers by almost seven million barrels next month as it is likely to witness a surge in domestic power demand over summer.More news: Rhythmone (LON:RTHM) Receives Buy Rating From Numis Securities Analysts
LCOc1, global benchmark Brent futures, were up by 0.4% and the same fell by 1.2% on Tuesday.
Non-cartel producers led by Russian Federation partially matched the cuts.
He said he's confident that the global oil market will soon rebalance and return to a "healthy state".
Hope seems to be rising for Nigeria and other oil producers as oil prices rose more than 3 per cent on Wednesday, bolstered by the biggest one-week drop in US inventories so far in 2017.
He said he expected global oil demand to grow at a rate close to a year ago.
Brent and USA light crude futures contracts closed on Tuesday at their second lowest levels since November 29, the day before OPEC announced it would cut output in the first half of 2017.
Due to the higher supply expected from outside producers, OPEC trimmed forecast demand for its crude in 2017 to 31.92 million bpd, down 300,000 bpd from the previous forecast and not far from current production.