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SINGAPORE: Crude oil prices edged down on Monday after sharp gains in the previous session, but were bolstered by forecasts of a contraction in supply and signs that trade tensions between China and China the United States could mitigate.
Brent International's futures contracts fell 20 cents on Monday, down 0.32% to 0339 GMT, to settle at $ 62.54 a barrel after closing 3.14% the most recent closing since November 21st.
US West Texas Intermediate (WTI) futures were $ 55.13 per barrel, down 13 cents (0.24%) from their latest settlement. WTI rose 2.73% in the last session to its highest closing level since 19 November.
Output of the Organization of the Petroleum Exporting Countries (OPEC) declined, while the pact to counter a surplus supply was compounded by the decline in the number of US oil rigs and the imposition of sanctions on oil companies. Venezuela oil sales.
"While Venezuela's production would have risen last month, new US sanctions could cut global supply from 0.5 to 1 percent," said Vivek Dhar, commodity badyst for Commonwealth Bank on Monday. of Australia.
The sanctions will severely limit oil transactions between Venezuela and other countries and are similar to those imposed on Iran last year, experts said after reviewing the details released by the US Department of Labor. Treasure.
According to a Reuters survey, OPEC oil reserves fell in January by a record volume in two years, despite the slowdown in production from Russia.
However, Russian oil production in January missed the goal of reducing production, Saturday revealed data from the Ministry of Energy. Last month's production dropped to 11.38 million barrels per day (bpd), but this is only 35,000 bpd from its October 2018 level, which is the basis of the pact.
Russian Energy Minister Alexander Novak said the country's overall reductions from the October base would reach 50,000 b / d in January. Russia is committed to reducing its oil production by 230,000 barrels a day from October.
US energy companies have reduced the number of their oil rigs to their lowest level in eight months, while some drillers have materialized their intention to spend less for new wells this year.
"The collapse in oil prices at the end of last year has resulted in more cautious spending for US explorers," Dhar said.
At the same time, hopes of easing Sino-US relations have also eased concerns about slowing economic growth.
"While the US and China still have to reach an agreement, markets have been encouraged by reports that they have made significant progress," ANZ Bank said in a research note.
US President Donald Trump announced last week that he would meet with Chinese President Xi Jinping, perhaps twice, in the coming weeks to try to seal a global trade deal with Beijing, while acknowledging that It was not yet clear to reach an agreement.
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