Oil Producers Have Consensus to Extend Cuts, 2 OPEC Members Say

OPEC to U.S. Please don't pump so much oil!More

Oil prices rose slightly on Friday, on track for their biggest weekly gain in five weeks, helped by expectations of an extension of OPEC-led output cuts and buoyed by falling USA crude inventories.

By the time OPEC meets in Vienna on May 25, USA output will be approaching the 9.5 million barrels a day mark - higher than in November 2014 when OPEC started a two-year price war.

The commodities research team at Goldman Sachs this week reiterated a base case the US benchmark West Texas Intermediate price to $50 per barrel and spot prices of $55 per barrel in 3 months.

Opec is due to meet in Vienna on May 25 to decide whether to roll over existing supply curbs of 1.8m barrels a day in total agreed with large rivals like Russian Federation at the end of previous year.

The report said that balancing the market would "require the collective efforts of all oil producers" and should be done "not only for the benefit of the individual countries but also for the general prosperity of the world economy".

USA crude production has risen more than 10 per cent since its mid-2016 trough to more than 9.3 million bpd, close to the levels of top producers Russian Federation and Saudi Arabia.

OPEC de-facto leader, Saudi Arabia, is increasingly unable to control the global oil supply because of rising energy production in the U.S., Russian Federation and Iran.

A monthly OPEC report released Thursday showed that cartel members were sticking to the production quotas.

United States light crude oil ended the day up 50 cents, or 1.6%, at $47.83.

It also forced US producers to become more efficient, and they can now withstand much lower prices than just a few years ago.

A day later, "we're seeing a pullback in price", said Andrew Lipow, president of Lipow Oil Associates in Houston.

Atkinson joined many analysts and energy commentators and urged OPEC to extend its cuts into the second half of the year.

According to the U.S. Energy Information Administration, American crude production will surpass the 10 million barrel a day mark by late next year, breaching the record high set in 1970. Prices are still up from about $48 a year ago.

The "baseline expectation continues to call for an extension" production cut agreement between members of OPEC and some non-OPEC producers, including Russian Federation, "but the details of any arrangement can have significant price impact", said Robbie Fraser, commodity analyst at Schneider Electric.

This week the estimate mushroomed to 950,000 barrels a day, mostly because of a resurgence of US shale production with a little help from Canada and Brazil.

Lipow said the market was also "slowly taking note" of increased production in Canada.

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