The OPEC and its partners discuss the reduction of the offer

NEW YORK (Reuters) – Oil edged up about 2 percent on Wednesday after partially offsetting strong sales in the previous session, against a backdrop of the ever-shrinking output of OPEC and Allied oil producers. 'a meeting next month to support the market.

Prices have picked up, Brent slightly surpassing $ 67 after Reuters announced that OPEC and its partners are discussing a proposal to cut production by 1.4 million barrels per day (bpd), a figure higher than the one previously mentioned by the authorities.

Brent LCoC1 futures were up $ 1.36 to $ 66.83 per barrel, up 2.1% at 11:35 am EST (16:35 GMT). CLc1's WCL futures contracts for delivery in December increased by $ 1.14 to $ 56.83 per barrel, a gain of 2.1%.

The price of Brent has fallen by more than 20% since early October due to concerns over excess supply and slowing demand, one of the largest declines since the beginning of the year. price collapse in 2014. US crude had recorded a record 12 consecutive sessions at its lowest since November. 2017

"The market has plummeted in recent weeks and today's pop is tied to the fact that producers could cut up to 1.4 million bpd in 2019," said Gene McGillian, vice -president market research for Tradition Energy in Stamford, Connecticut.

"Maybe some of the fears of additional supplies and reduced demand have finally been incorporated into the market, but I would not say that a floor has already been installed."

The sale on Wednesday was further exacerbated by the unraveling of oil trade between oil and natural gas, market participants said. When oil fell from its peak in October, NGc1 natural gas futures rose 56% over this period to a record high of 4½ years.

In addition, financial companies are hedging the risk of selling put options to oil producers, putting additional downside pressure when prices fall, resulting in an option strike, said Goldman Sachs in a note.

Oil markets are under pressure from two sides: an increase in the supply of OPEC, Russia, the United States and other producers; and growing concerns about the global economic slowdown.

"This market is trying to find a price floor after an unprecedented 12 consecutive days of decline," said Jim Ritterbusch, president of Ritterbusch and Associates, in a note.

"Although the supply surplus is still relatively modest, the market is focused on the dynamics of expanding the overhang that will have to show signs of turning around before a bottom up. price can be established. "

In its monthly report, the Paris-based International Energy Agency (IEA) said the implied inventory buildup for the first half of 2019 was 2 million bpd.

The IEA left its global demand growth forecast for 2018 and 2019 unchanged from last month at 1.3 million barrels per day (bpd) and 1.4 million barrels per day, respectively, but cut its forecast for non-OECD demand growth, engine of the global expansion of gasoline consumption.

Production of US crude oil from its seven major shale basins is expected to hit a record 7.94 million barrels per day (bpd) in December, the Energy Information Administration (EIA) of the US Department of Energy (US) said Tuesday. Energy.

This increase in land-based production has allowed the overall US crude oil production C-OUT-T-EIA to hit a record 11.6 million bpd, making the United States the world's largest oil producer ahead of Russia and Saudi Arabia.

Most analysts expect US production to exceed 12 million bpd in the first half of 2019.

The increase in US production contributes to the increase in inventories. The official storage data is to be released Thursday to the EIA, analysts expecting an increase of 3 million barrels of crude stocks.