Oil prices rose almost 1 on Thursday after a fall in U.S. stockpiles added further support following the unilateral decision by Saudi Arabia, the worlds biggest exporter, to cut output over the next two months.
It was not immediately clear how the storming of the U.S. Capitol by supporters of President Donald Trump would impact oil markets, although some analysts believe Presidentelect Joe Bidens administration will clamp down on U.S. oil production.
Brent crude was up 44 cents, or 0.8, at 54.74 a barrel by 0734 GMT, after gaining 1.3 overnight. U.S. West Texas Intermediate WTI gained 51 cents, or 1 to 51.14. The contract rose 1.4 on Wednesday.
Saudi Arabia, the worlds biggest oil exporter, said it would voluntarily cut 1 million barrels per day bpd of output in February and March, after OPEC, which groups the Organization of the Petroleum Exporting Countries and other producers, including Russia, met earlier this week.
WTI crude seems poised to rise higher as the Biden administration will clamp down on U.S. crude production, the Saudis tentatively alleviated oversupply concerns with their 1million bpd cut present, and as the dollars days seem numbered, said Edward Moya, senior market analyst at OANDA.
A lower dollar, which makes oil cheaper because the commodity is mostly traded using the greenback, is also supporting prices, analysts said.
U.S. crude stocks dropped and fuel inventories rose, the Energy Information Administration said on Wednesday. EIAS