Oil stable on possible OPEC Extension

US WTI crude oil held steady, this morning, as price action got a small boost on hope that OPEC and Russia have agreed to extend a production cut beyond the first half of this year.

However, there was another rise in US based shale oil production. Recent data showed that production continues to amp up. This dampened Brent oil futures. This traded at $50.86 per barrel, as of 1:20 am GMT. Brent was little changed from its last close at $50.84, seen on Friday.

US WTI contract was trading at $47.88 per barrel, this morning. Little changed from the Friday close at $47.84.

What is supporting oil? Analysts are saying that investors are hoping for the Organization of the Petroleum Exporting Countries (OPEC) as well other countries, including Russia, have agreed to extend an agreement to cut output by almost 1.8 million barrels per day. With the ever increasing US shale output this is merely a drop in the barrel. However, any OPEC deal should provide near-term support of the black gold.

US Crude Oil Output Increases

There is also news that Saudi Energy Minister Khalid al-Falih and his Russia’s Alexander Novak are scheduled to meet in Beijing on Monday to discuss crude output policy. Russia is the largest producer of oil in the word. With Saudi Arabia, they control 20 million barrels of output per day. This is a fifth of the world’s consumption.

However, the United States is increasing the output of shale crude and is undermining OPEC and Russia to reduce the global supply glut and increase the price of the black gold. Recent data showed that US energy firms have added oil rigs for a 17^th week in a row. This extends a yearlong drilling recovery. This is expected to help boost production in the United States to a record high next year.