US oil climbed for a second day on Friday underpinned by expectations of tighter supply, but prices remained in a range as they were pressured by rising US inventories. US West Texas Intermediate (WTI) crude oil futures were trading up 20 cents at $51.57 per barrel at 0038 GMT. Brent crude was yet to trade.
The International Energy Agency (IEA) said that while it was “far too soon” to gauge OPEC members’ compliance with promised cuts, commercial oil inventories in the developed world fell for a fourth consecutive month in November, with another decline projected for December.
But U.S. crude inventories rose unexpectedly last week as refineries sharply slowed production, while gasoline stocks soared amid weak demand, the Energy Information Administration said on Thursday.
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Crude inventories rose 2.3 million barrels in the week to Jan. 13, compared with analyst expectations for an increase of 342,000 barrels.
The data showed much larger-than-expected builds in gasoline with inventories of the motor fuel on the U.S. East Coast swelling to the highest weekly levels on record for this time of year, when refiners typically begin storing barrels ahead of summer driving season.
“Crude oil prices were range-bound despite the EIA’s weekly report showing a gain in inventories,” ANZ said in a note.
“OPEC continued its commentary around a strong adherence to the production cut agreement as the monitoring committee meetings to discuss progress.”
Brent as well WTI futures were on track for a second week of declines.
OPEC, which is cutting oil output alongside independent producer Russia, wants a lasting partnership with Moscow, Saudi Energy Minister Khalid al Falih told Reuters. He said the deal need not be extended for a full year if the market rebalances.
Oil stocks around the world need to decline by at least another 270 million barrels to reach a five-year industry average for OPEC to be able to say the markets are becoming balanced, OPEC Secretary General Mohammed Barkindo told Reuters.