Oil prices start 2019 on a positive note, rally to $57 per barrel

OIL PRICES BE GAN 2019 on a positive note as Brent crude futures rallied to $57 per barrel, heading for its biggest weekly gain since July 2017 as OPEC’s production cuts outweighed concerns over the health of the global economy.

Oil has risen for five days, shaking off concern over global growth and optimism that the U.S. and China are working towards a thaw in trade tensions has helped bolster prices.

Oil prices experienced its worst quarter in four years and a 20 percent annual loss driven by panic over a growing glut of crude, OPEC’s output plunged by the most in almost two years last month and producers have pledged to curb supplies through the first half of 2019, concerns about the oversupply prevail as stockpiles at America’s main storage hub show signs of swelling. “While crude seemed to have bottomed out and is expected to edge higher, there’s a possibility for additional drops along the way, driven by seasonal factors and risks from wider financial markets,” said Hong Sungki, a commodities trader. “Still, oil rebounded yesterday, shaking off the slump in equities, which is an encouraging sign.”

Saudi Arabia, the world’s biggest crude exporter, trimmed production last month, bringing overall output in the Organization of Petroleum Exporting Countries down 530,000 barrels a day to 32.6 million a day, according to a Bloomberg survey of officials, analysts and ship-tracking data. This represents the sharpest pullback since January 2017 when OPEC started on its strategy to clear a glut created by surging supplies from shale producers.