OPEC and Russian Federation agreed to output cut, despite United States pressure

US investment banks see low oil prices despite OPEC cut

The market will get a peak at USA oil inventories this afternoon when the American Petroleum Institute (API), an industry group, releases a report at 4:30 p.m. EST.

Analysts said a decision by the Organisation of the Petroleum Exporting Countries (OPEC) and some non-OPEC producers including Russian Federation to cut supply by 1.2 million barrels per day (bpd) would likely stabilise prices, although several said they did not expect the agreement to push markets much higher.

"In April, we will have a meeting to review the decision", United Arab Emirates Energy Minister Suhail Al Mazrouei told reporters on the sidelines of a conference in Dubai.

Most of the large oil producers have reached to the agreement to cut the oil production.

Its oil production level of 11.4 million barrels per day will be reduced by about 2 percent, to 228 thousand barrels.

"The market have asked us to take action and increase production a few months ago and we did".

Azerbaijan presented data on its daily oil production in November 2018 to the OPEC Joint Technical Committee as part of the Vienna Agreement, Trend reports citing the Azerbaijani Energy Ministry.

The oil price has fallen by a third since the start of October, when it hit a four-year high above $87.

Despite this, the outlook for next year remains muted on the back of an economic slowdown.

Last week, for the first time in decades, the United States - which is not a member of OPEC - was a net exporter of crude oil and petroleum products. "Production's exceeding of the consumption in the market and predictions about the decline in the world economy for the next year determined the fall in oil prices".

Iran maybe exporting around 1 million barrels per day now and any reduction may tighten the oil markets, especially around seasonally strong demand during summers.

According to the International Energy Agency (IEA), the demand for crude oil produced by OPEC countries at the world market is now at 31.3 million barrels.

Although Qatar is OPEC's smallest Middle East oil producer, it's now the world's biggest liquefied natural gas (LNG) exporter.

Kotak Institutional Equities expects a gradual recovery in crude prices from the recent lows, as the proposed curtailment by OPEC and Canada will balance the global oil supply demand in the near term, especially as seasonally weak demand season gets over in Q1CY19.

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