Oil prices ease while Russia warns of gradual production increase

Oil Stock Markets

Oil prices eased on Friday as Russia hinted it may gradually increase output, after having withheld supplies in concert with producer cartel OPEC since 2017.
 

Brent crude futures LCOc1 were at $78.69 per barrel at 0208 GMT, down 10 cents from their last close, and more than 2.2 percent below the $80.50 November 2014 high they reached on May 17. Brent broke through $80 for the first time in more than three years earlier in May.

U.S. West Texas Intermediate (WTI) crude futures were at $70.62 a barrel, down 9 cents from their last settlement.

“Oil prices are now starting to drift a little,” said Greg McKenna, chief market strategist at futures brokerage AxiTrader, adding that this was due to OPEC’s and Russia’s “moves toward an increase in production at the June meeting”.

The Middle East dominated Organization of the Petroleum Exporting Countries (OPEC) as well as a group of non-OPEC producers led by Russia started withholding output in 2017 to tighten the market and prop up prices.

But Russia, in particular, has been floating a potential end to the production cuts, with energy minister Alexander Novak saying on Thursday that restrictions on oil production could be eased “softly” if OPEC and non-OPEC countries see the oil market balancing in June.

 While Russia and OPEC benefit from higher oil prices, which have risen by almost 20 percent since the end of last year, their voluntary production cuts have opened the door to other producers to ramp up output and gain market share.

U.S. crude oil production C-OUT-T-EIA has risen by more than a quarter in the last two years, to 10.73 million barrels per day (bpd). Only Russia produces more, at around 11 million bpd.

Output by producers like the United States, Canada or Brazil who are not bound by the OPEC/Russian led agreement to cut, will likely rise further as higher crude prices improves their profitability.

Energy may give further boost to U.S. small-cap stocks

Global Stock Markets

U.S. small-cap stocks look poised to extend a breakout rally, especially if oil prices advance deeper into levels last seen in 2014 to drive further gains in the small energy companies that have provided leadership in recent week, analysts and investors said. 

The Russell 2000 index of small capitalization stocks closed at a record high for a third day in a row on Friday and registered its third week of gains, sharply outperforming large-cap stocks on Wall Street, with all three major indexes posting losses for the week.

The Russell is up 11.1 percent since its Feb. 8 low for the year, while the S&P 500 is up just 5.1 percent since that date.

The S&P 600 small-cap index is also at a record high. Energy shares within the S&P 600 have led recent gains, thanks to a jump in oil prices, which analysts said should boost earnings forecasts for the sector.

The outperformance of small-cap stocks has been driven partly by the December U.S. tax overhaul. The legislation included steep corporate tax cuts that particularly benefited smaller-cap companies, which had been paying higher rates than large-cap companies overall.

Recent trade tensions have also lifted shares of small caps, whose business is largely domestic, along with stronger U.S. economic growth.

Some of those benefits have been reflected in small-cap earnings growth, which has outpaced growth of larger names. First-quarter profit growth for Russell 2000 companies is estimated at 33.8 percent, while earnings for the S&P 500 companies increased 26.2 percent from a year ago,

The S&P 600 energy index is up 31.3 percent for the quarter so far, the best-performing group, followed by health care, up 12.2 percent.

U.S. crude futures edged lower on Friday but remained above $71 a barrel and registered a third straight week of gains, lifted by falling Venezuelan production, strong global demand and looming U.S. sanctions on Iran.

Several investors also said they favored financials within the small-cap space, particularly regional banks, which have risen sharply this year compared with bigger banks. The S&P 500 bank index is down 0.3 percent year to date, compared with a 6.2 percent gain in the KBW regional banking index.

The prospect of regulations being reduced further for some smaller banks has been a positive.


The health care group has benefited from merger activity, including Zoetis Inc’s announcement this week to buy Abaxis Inc .

Health care has been the best-performing sector within the S&P 600 so far this year, up 26.8 percent.

Oil gains ease as investors await Trump's decison on Iran

Oil Stock Markets

Oil prices eased slightly on Tuesday, a day after hitting 3-1/2 year highs, as investors braced for President Donald Trump’s decision on whether to withdraw the United States from the Iran nuclear deal, a move that could disrupt global oil supply. 

Asian shares picked up, helped by technology stocks as generally upbeat earnings overcame weakness in the global smartphone market and concerns about more regulation.

U.S. West Texas Intermediate (WTI) crude futures CLc1 on Monday rose above $70 for the first time since November 2014, putting it more than 18 percent above this year’s low touched in February.

On Tuesday, some of those oil-price gains were pared as traders took profit after Trump said in a tweet he would announce his decision on the nuclear deal at 1800 GMT Tuesday.

“The oil market has priced in the high likelihood of Trump withdrawing from the nuclear deal with Iran. If he is going to impose sanctions similar to those the U.S. had in 2012, that would likely cause a shortage in oil,” said Tatsufumi Okoshi, senior commodity economist at Nomura Securities.

Adding to market pressures, falls in Venezuelan oil production due to problems at the country’s oil company PDVSA also added to the rally.

U.S. crude futures last traded at $69.97 per barrel, down 1.1 percent from Monday’s settlement price.
Global benchmark Brent crude futures LCOc1 stood at $75.54 per barrel, down 0.8 percent, having risen as high as $76.34 on Monday.

While caution on Trump’s statement kept investors edgy in early trade, technology firms helped to generate gains for Asian equities.

MSCI's broadest index of Asia-Pacific shares outside Japan .MIAPJ0000PUS gained 0.6 percent, with information technology shares .MIAPJIT00PUS rising 1.2 percent. Japan's Nikkei .N225 was 0.3 percent higher.

Tech shares also lifted South Korea's Kospi index .KS11, which rose 0.4 percent.

Markets Update:

SPI futures up 4 points, or 0.07%, at 6050 as of 7am AEST.

AUD/USD fell 0.2% to 74.91 US cents

On Wall Street: Dow Jones -0.7%, S&P 500 -0.7%, Nasdaq -0.4%.

In New York: BHP up 1.4%, Rio u[ 0.8%.

In Europe: Stoxx 50 +0.5%, FTSE 100 +0.3%, CAC 40 +0.2%, DAX +1.5%.

Spot gold down 0.1% to US$1304.73 an ounce.

Brent crude flat at US$73.11 a barrel.

US crude oil up 0.7% at US$67.73 a barrel.

Dalian iron ore up 2.35% at CNY479.50 a tonne.

LME aluminium up 2.7% at US$2322 a tonne.

LME copper up 1.1% to US$6820 a tonne.

10-Year Bond Yield: US 2.97%, Germany 0.58%, Australia 2.8%.

Europe joins sell-off but Wall Street eyes rebound

European Stock Markets

World markets battled to regain their poise on Tuesday after another round of tech and trade war worries had clobbered shares and oil prices tumbled on signs of rising Russian supply and Saudi price cuts.

Europe’s main markets in London, Paris and Frankfurt were all down more than 0.5 percent, after being closed on Monday when the pace of selling had pushed U.S. markets below pivotal technical levels.

Tech stocks remained the pressure point, dropping more than 1 percent, after more criticism of Amazon by U.S. President Donald Trump and as reports that Apple intended to make more of its own parts burnt European chipmakers like ams AG and STMicroelectronics.

Some signs of stability were emerging, though. Wall Street futures pointed higher, the dollar steadied against the yen after three days of decline and gold and government bonds were in reverse.

Asia’s shares had stumbled overnight, too, although less than Wall Street, where the S&P 500 closed below its 200-day moving average for the first time since Britain’s 2016 vote to leave the European Union.

As well as the tech problems, investors were also wary after China imposed extra tariffs on 128 U.S. products, deepening a dispute between the world’s two biggest economies and stoking concerns about the impact on global growth.

Japan’s Nikkei ended down 0.45 percent, after falling as much as 1.6 percent. China’s Shanghai Composite index eased 0.9 percent and the blue-chip CSI300 was off 0.7 percent.

U.S. Treasuries, German Bunds and UK Gilts all saw a bit of selling, with yields on 10-year notes off two- to three-month lows.

Among the main commodities, Brent oil futures nudged back up towards $68 a barrel. They had fallen more than 3.7 percent on Monday after news of rising Russian output and the escalating U.S.-China trade dispute weighed on sentiment.

U.S. crude gained 14 cents to $63.15, copper jumped 1.4 percent for its fourth straight gain and spot gold ticked down 0.2 percent to $1,338.08 an ounce.

Oil stable after two days of decline

Oil Stock Markets

Oil prices were stable on Wednesday after posting two days of declines at the start of the week. 

Support came from a report that U.S. crude inventories are not rising as much as expected during the spring season now starting, implying healthy demand, and from strong China data.

U.S. West Texas Intermediate (WTI) crude futures CLc1 were at $60.76 a barrel at 0430 GMT, up 5 cents, or 0.1 percent, from their previous close.

Brent crude futures LCOc1 were at $64.59 per barrel, down 5 cents, or 0.1 percent.

U.S. crude inventories rose by 1.2 million barrels in the week to March 9, to 428 million barrels, the American Petroleum Institute said on Tuesday. That compared with analysts’ expectations for an increase of 2 million barrels.

Some support also came from China, where January-February domestic crude oil production fell 1.9 percent on the year to 30.37 million tonnes, equivalent to 3.77 million barrels per day (bpd),
according to data from the National Statistical Bureau on Wednesday. At the same time, crude oil throughput rose 7.3 percent to 93.4 million tonnes, implying a need for more imports.

Despite this, oil markets remain relatively weak. Prices have not returned to their January highs of over $70 per barrel for Brent and almost $67 for WTI.

U.S. crude production C-OUT-T-EIA has soared by almost a quarter since mid-2016 to 10.37 million bpd, overtaking output by top exporter Saudi Arabia.

U.S. production is expected to rise above 11 million bpd by late 2018, taking the top spot from Russia, according to the International Energy Agency (IEA).

Weekly U.S. crude production figures will be published by the Energy Information Administration (EIA) later on Wednesday. [EIA/S]

The increases in U.S. production has this year exceeded the supply cuts led by the Organization of the Petroleum Exporting Countries (OPEC), which have been in place since 2017 in an effort by the cartel, and supported by non-OPEC member Russia, to prop up prices.

Estimates by the EIA show global supplies will exceed 100 million bpd for the first time in the second quarter of 2018, while demand will only break through that level in the third quarter, implying a slightly oversupplied market.

That would be a reversal from a supply deficit in 2017 and early 2018.

Oil prices fall on relentless rise in U.S. crude output

Oil Stock Markets

Oil prices fell on Tuesday, extending losses from the previous session, as the inexorable rise in U.S. crude output weighed on markets. 

U.S. West Texas Intermediate (WTI) crude futures CLc1 were at $61.25 a barrel at 0414 GMT, down 11 cents, or 0.2 percent, from their previous close. 

Brent crude futures LCOc1 were at $64.85 per barrel, down 10 cents, or 0.2 percent. 

Both crude benchmarks dropped by around 1 percent in their Monday sessions. 

“Oil prices fell on the back of concerns that surging U.S. production ... could push inventories in the U.S. higher,” ANZ bank said on Tuesday. 

U.S. crude oil production C-OUT-T-EIA soared past 10 million barrels per day (bpd) in late 2017, overtaking output by top exporter Saudi Arabia. 

U.S. production is expected to rise above 11 million bpd by late 2018, taking the top spot from Russia, according to the International Energy Agency (IEA). 

The rising U.S. output comes largely on the back of onshore shale oil production. 

U.S. crude production from major shale formations is expected to rise by 131,000 bpd in April from the previous month to a record 6.95 million bpd, the U.S. Energy Information Administration (EIA) said in a monthly report on Monday. 

That expected increase would top the 105,000 bpd climb in March from the previous month, to what was then expected to be a record high of 6.82 million bpd, the EIA said. 

The EIA is due to publish its latest weekly U.S. production data on Wednesday.

Oil prices set to slip over the week: pressure from rising U.S. output

Global Stock Markets

Oil prices were broadly steady on Thursday but still set to slip over the week for the second time in a row against a backdrop of rising U.S. crude production and an increase in inventories. 

Brent crude futures LCOc1 were down 3 cents at $64.31 per barrel by 1005 GMT. U.S. West Texas Intermediate (WTI) crude futures CLc1 were up 3 cents at $61.18 a barrel.

Brent was on track for a drop of around 0.1 percent this week, after last week’s 4.4 percent slide.

A build in U.S. crude inventory reported the previous day was not as large as expected, given that stocks tend to rise towards the end of the winter as refineries conduct maintenance.

But with the threat of the United States sparking a trade war with some of its largest partners, financial markets were on edge. Prices of commodities stayed under pressure. 

China reported a steep monthly drop in crude imports in February, when the Lunar New Year holidays took place. Imports of crude dropped by more than 20 percent to a daily rate of 8.2 million barrels per day (bpd) from 9.4 million bpd in January.

Iimports in January and February combined gave a daily rate of about 9.02 million bpd, up 10.8 percent from the same period last year. [RUSSELL/]

Rising U.S. production, which reached 10.37 million bpd last week, remains a focus for investors.

U.S. output is expected to surge beyond 11 million bpd by late 2018, which would surpass the current No. 1 producer Russia.

This U.S. increase is putting pressure on the Organization of the Petroleum Exporting Countries, Russia and other nations which have been curbing output to prop up prices but risk losing market share.

Oil steadies after big fall

Oil Stock Markets

Oil prices steadied on Thursday, supported by healthy demand, after falling the previous day on the back of record U.S. crude production and rising inventories. 

Brent crude futures LCOc1 were at $64.46 per barrel at 0506 GMT, up 12 cents, or 0.2 percent, from their previous close. That slight rise came after a more-than-2 percent fall the previous day.

U.S. West Texas Intermediate (WTI) crude futures CLc1 were at $61.26 a barrel, up 11 cents, or 0.2 percent. WTI also fell by more than 2 percent the previous session.

The slight recovery on Thursday came amid a U.S. crude inventory build that was not as big as expected during the current seasonal demand lull at the end of winter, when many oil refineries shut down for maintenance. 

The EIA reported late on Wednesday that U.S. crude inventories C-STK-EIA rose by 2.4 million barrels in the week to March 2, to 425.91 million barrels, less than the 2.7 million barrel increase analysts had forecast.

On the demand side, U.S. bank Goldman Sachs said in a note to clients dated March 7 that the outlook remained for healthy growth, despite recent signs of a slight economic slowdown.

Despite this, soaring U.S. production, which last week marked another record, at 10.37 million barrels per day (bpd), is looming over oil markets.

Oil steady; OPEC-led cuts lend support

Global Stock Markets

Oil was broadly unchanged on Tuesday, as a recovery from last week’s lows fizzled out, although ongoing production restrictions by the world’s largest exporters prevented prices from falling back. 

The prospect of OPEC and other producers, including Russia, maintaining their crude output cuts in the face of a boom in U.S. shale production has helped to push the oil price back above $65 a barrel this week, even though the U.S. dollar is not far off two-month highs, often a dampener for the broader commodity markets. 

Brent crude futures LCOc1 were down 5 cents at $65.49 a barrel by 1031 GMT, while U.S. West Texas Intermediate futures CLc1 were up 4 cents at $62.61 a barrel. 

The International Energy Agency (IEA) said on Monday global oil demand was expected to grow over the next five years, while output from producers in the Organization of the Petroleum Exporting Countries (OPEC) would rise at a much slower pace. 

This initially gave the oil price a boost on Monday, but the IEA’s caveat that the United States would make up for much of the shortfall in output by OPEC has since acted as a drag. 

U.S. crude production has risen to more than 10 million barrels per day (bpd), overtaking top exporter Saudi Arabia. Output hit a record 10.057 million bpd in November, according to the U.S. Department of Energy. 

Weekly U.S. crude inventory data is expected to show a second consecutive weekly rise in the week to March 2, according to a Reuters poll. 

The American Petroleum Institute (API) will release its weekly inventory data at 4:30 p.m. EST (2130 GMT) on Tuesday, and the U.S. Energy Department’s Energy Information Administration (EIA) reports its data

Rising U.S. Oil output undermines OPEC/Russia supply cuts

Oil Stock Markets

Oil prices fell on Friday as market fundamentals are expected to weaken with the upcoming end of the peak demand period during the Northern Hemisphere winter.

Brent crude futures were at $70.18 per barrel at 0504 GMT, down 24 cents, or 0.3 percent, from their last close. Brent the previous day rose its highest since December 2014 at $71.28.

U.S. West Texas Intermediate (WTI) crude futures were at $65.32 a barrel, down 19 cents, or 0.3 percent from their last close. WTI also marked its highest since December 2014 in during the previous session at $66.66.

Georgi Slavov, head of research at commodities brokerage Marex Spectron, said despite a generally healthy outlook for oil demand, there were short-term headwinds due to the upcoming end of the peak demand period during the Northern Hemisphere winter season.


On the supply side, U.S. oil production is expected to hit 10 million barrels per day (bpd) soon, after reaching 9.88 million bpd last week.

Output has grown by more than 17 percent since mid-2016, and is now on par with top exporter Saudi Arabia's.

Only Russia produces more, averaging 10.98 million bpd in 2017.

Rising U.S. output is threatening to undermine the supply restraint led by the Organization of the
Petroleum Exporting Countries (OPEC) and Russia aimed at propping up prices.

These cuts, coupled with demand growth, have contributed to a near 60 percent rise in oil prices since mid-2017 as excess crude inventories around the world have been drawn down.

Crude oil futures have also received support from a weakening dollar.

The U.S. currency has lost almost 13 percent in value against a basket of other leading currencies since the start of 2017.

As oil is traded in dollars, swings in the greenback can also impact oil demand as it affects the price of fuel purchases for countries using other currencies.

Oil markets cling to near 3-year highs on tighter US market

Oil Stock Markets

U.S. West Texas Intermediate (WTI) crude futures were at $63.53 a barrel at 0144 GMT, 4 cents below their last settlement but still close to a December 2014 high of $63.67 per barrel reached the previous day.

Oil prices held near three-year highs on Thursday, supported by a surprise drop in U.S. production and lower crude inventories, although analysts increasingly warned of signs that fuel markets have overheated.

U.S. West Texas Intermediate (WTI) crude futures were at $63.53 a barrel at 0144 GMT, 4 cents below their last settlement but still close to a December 2014 high of $63.67 per barrel reached the previous day.

Brent crude futures were at $69.14 a barrel, 6 cents below their last finish. That was also close to the previous day's high of $69.37 a barrel, which was the highest level since an intra-day spike in May 2015 and, before that, in December 2014.

Oil markets have generally been supported by a production cut led by the Organization of the Petroleum Exporting Countries (OPEC) and Russia that started in January last year and is set to last through 2018.

More immediate price support came overnight from the United states, where crude inventories fell almost 5 million barrels in the week to January 5, to 419.5 million barrels.

That's slightly below the five year average of just over 420 million barrels.

U.S. production fell 290,000 barrels per day to 9.5 million bpd, the EIA said, foiling expectations of U.S. output breaking through 10 million bpd.

Bearish signals include a rise in fuel inventories as well as a fall in refined products profits in Asia, which are expected to hamper orders for new feedstock crude.

U.S. gasoline stocks rose 4.1 million barrels, EIA data showed, more than expected, while Singapore average refinery profit margins have fallen below $6 per barrel this month, their lowest seasonal level in five years.

Singapore average refinery profit margins have fallen below $6 per barrel this month, their lowest seasonal level in five years.

And with the crude price up by more than 13 percent since early December, some analysts expect a downward price correction following the recent bull-run.

U.S. crude hits three-year high as prices climb in tight market

Oil Stock Markets

Oil prices edged higher with U.S. crude touching its highest since December 2014 on Tuesday, supported by OPEC-led production cuts and expectations that U.S. crude inventories have dropped for an eighth week in a row. 

The Organization of the Petroleum Exporting Countries and allies including Russia are keeping supply limits in place in 2018, a second year of restraint, to reduce a price-denting glut of oil held in inventories.

U.S. West Texas Intermediate (WTI) crude rose $1.23, or 2 percent, to settle at $62.96 a barrel after touching its highest since December 2014 at $63.24.

Brent crude ended the session up $1.04, or 1.5 percent, at $68.82 per barrel after hitting a session high of $69.08, its highest since May 2015. Both contracts had their strongest close since December 2014.

Prices extended gains in post-settlement trade after industry group the American Petroleum Institute said crude inventories fell by 11.2 million barrels in the week to Jan. 5 to 416.6 million, compared with analysts’ expectations for a decrease of 3.9 million barrels. [API/S]

If confirmed by U.S. government data at 10:30 a.m. EST (1530 GMT) on Wednesday, the draw will be the largest since Sept. 2, 2016. U.S. stockpiles fell by 14.5 million barrels during that week.

OPEC is cutting output by even more than it promised and the restraint is reducing oil stocks globally, a trend most visible in the United States, the world’s largest and most transparent oil market. [OPEC/O]

Many producers, still suffering from a 2014 price collapse, are enjoying the rally, although they are wary it will spur rival supply sources. Iran said OPEC members were not keen on increased prices.
The rise in prices is expected to drive gains in U.S. production during 2018, offsetting curbs by others.

U.S. crude oil production is expected to surpass 10 million barrels per day (bpd) next month, en route to an all-time record months ahead of previous forecasts, the U.S. Energy Information Administration said Tuesday.

Production was expected to rise to an average 10.04 million bpd during the first quarter of this year.
Some analysts have said the rise in U.S. shale oil production could discourage OPEC and Russia to maintain their deal to curb supply until the end of the year for fears of losing market share.

Oil up at year end, U.S. crude hits highest since mid-2015

U.S. oil prices rose above $60 a barrel on the final trading day of the year and hit their highest since mid-2015, as an unexpected fall in American output and a decline in commercial crude inventories stoked buying in generally thin trading.

International benchmark Brent crude futures also rose, supported by ongoing supply cuts by top producers OPEC and Russia as well as strong demand from China.

Oil prices are set to close out the year with strong gains. Brent is up 17 percent since the beginning of the year and U.S. West Texas Intermediate is up 12 percent. Prices are up nearly 50 percent since the middle of the year, after a springtime slump.

Wall Street set to open higher on final trading day of 2017

U.S. stocks were poised to open on a bright note on the final trading day of 2017, wrapping up a year in which major Wall Street indexes recorded their best performance since 2013.

Investors were treated to bumper gains in the year, with strengthening global economy, solid corporate earnings and low interest rates fueling the nine-year old rally in global stocks.

The market has shown surprising strength despite tensions in North Korea and political upheavals in Washington. The S&P 500 has closed below 1 percent only four times this year.

Nasdaq 100 e-minis NQc1 were up 18 points, or 0.28 percent, on volume of 13,512 contracts.

U.S. oil prices hit their highest since mid-2015 as an unexpected fall in American output and a drop in commercial crude inventories stoked buying. [O/R]

Shares of Schlumberger (SLB.N) were up 0.8 percent in premarket trading, while those of Exxon (XOM.N) edged up 0.1 percent.

Oil falls on doubts over extending output cuts, surprise rise in U.S. crude stocks

Oil Stock Markets

Oil prices fell on Wednesday on doubts OPEC and Russia will agree on extending a crude production cut that the market has already priced in, and after a report of an unexpected rise in U.S. crude oil inventories. 

 
U.S. West Texas Intermediate (WTI) crude futures were at $57.69 a barrel at 0543 GMT, down 30 cents, or 0.5 percent below their last settlement.

Traders said WTI was pulled lower by a report from the American Petroleum Institute (API) late on

Tuesday that showed U.S. crude inventories rose by 1.8 million barrels in the week ended Nov. 24 to 457.3 million barrels.

Official U.S. oil inventory data is due later on Wednesday.

WTI was also weighed down by the gradual restart on Tuesday of the Keystone pipeline, which supplies Canadian crude to the United States.

Brent crude futures, the international benchmark for oil prices, were at $63.17 a barrel, down 44 cents, or 0.7 percent.

Oil prices have received a broad lift this year, with Brent up by 40 percent since mid-2017, due to an effort by the Organization of the Petroleum Exporting Countries (OPEC) and a group of other producers, led by Russia, to withhold 1.8 million barrels per day (bpd) of output.

The deal expires in March 2018, but OPEC will meet on Nov. 30 and is expected to discuss ways of extending the cut.

Many analysts say an extension is needed to balance oil markets, and also to keep the economies of oil exporting nations afloat. Yet not all analysts agree.

Given the agreement doesn't expire for another four months, adding an additional nine months on that to the end of 2018 seems unnecessarily eager given the market does seem to be rebalancing.

Beyond cutting supplies, a healthy global economy has been helping oil markets back into balance after years of oversupply.

U.S. bank Morgan Stanley said global economic growth was likely to gain momentum and breadth in 2018.

U.S. oil dips on increased drilling, but OPEC cuts support global markets

U.S. oil prices dipped on Monday, easing from two-year highs on the prospect of increased U.S. output, although global markets were slightly better supported by expectations an OPEC-led supply cut will be extended.

U.S. West Texas Intermediate (WTI) crude futures were at $58.68 a barrel at 0436 GMT, down 27 cents, or 0.5 percent, from their last settlement. Brent crude futures LCOc1 fell just 4 cents to $63.82 a barrel.

U.S. crude production C-OUT-T-EIA has risen by 15 percent since mid-2016 to 9.66 million barrels per day (bpd), not far from top producers Russia and Saudi Arabia, and increasing drilling activity for new production means output is expected to grow further, traders said.

U.S. energy companies last week added oil rigs, with the monthly rig count rising for the first time since July, to 747 active rigs, as producers are attracted by climbing crude prices. touched a 2015 high on Friday at $59.05 a barrel, partly driven higher by the closure of the 590,000 bpd Keystone pipeline connecting Canada's oil sand fields with the United States following a spill, which reduced stocks.

In global markets, Brent crude oil futures were stronger than WTI due to an effort by the Organization of the Petroleum Exporting Countries (OPEC) and a group of other producers, including Russia, to withhold 1.8 million bpd of output since January.

The deal to cut output expires in March 2018, but OPEC will meet on Nov. 30 to discuss its policy.

Russian Energy Minister Alexander Novak said on Friday that Russia would discuss the details of an extension on Nov. 30, but made no mention of how long this should last beyond its March expiry. uncertainty of how committed Russia is to ongoing cuts, as well as rising production in the United States, mean crude prices are being prevented from rising much further, traders said.
There is plenty of room for disappointment... Should the outcome of the next OPEC meeting fall short of expectations, the large net-long speculative position on oil futures can unwind, sending prices lower and volatility higher, BNP Paribas warned.

Analysts also noted technical chart indicators that implied crude oil futures were in for a downward correction.