Oil prices set for biggest weekly drop in a month

West Texas Intermediate crude oil was rising 0.7% early Thursday to $51.21 a barrel, while Brent crude, the global benchmark, was up 0.8% to $53.37 a barrel.

Leading Persian Gulf oil producers Saudi Arabia and Kuwait gave the clearest signal yet that OPEC plans to extend a deal with non-OPEC producers to curb oil supplies into the second half of the year.

Russian Federation has cut 250,000 bpd of its crude oil output, with another 50,000 bpd to go as per its agreement with OPEC, Energy Minister Alexander Novak told media today, adding that the other 50,000 bpd will be cut by the end of the month.

USA production is soaring, jumping by nearly 10 per cent since mid-2016 to 9.25 million bpd. Though many ministers have indicated their support for an extension of the production cuts, Falih said that OPEC was "still communicating with many countries".

The Russian energy minister said that he was discussing further oil production cuts with Russian companies and executive bodies.

Saudi Arabia's energy minister Khaled Al Falih said: "consensus is building for the extension of the deal".

The goal was to reduce bulging global inventories and lift oil prices.

Omani Minister of Oil and Gas Mohammed bin Hamad Al Rumhi said a "quite high" number of producers favored extending the supply restraint agreement.

There is some suggestion that Opec has been selling oil out of its own stocks in order to meet customer demand despite some production cuts it made earlier this year.

The mood was upbeat on the impact and compliance of the existing production cuts and the Kuwait oil minister, Essam Al Marzouq said "all twenty-four countries, including Russian Federation are in favour of extension of the agreement".

Both the Brent and WTI oil benchmarks are down more than 7.5 per cent since the end of past year.

The historic Opec and non-Opec output reduction pact, a first of its kind in 15 years, was inked by both sets of producers in December 2016. OPEC, under Saudi leadership, appears determined to see through its efforts to drain global inventories back to five-year average levels, but it is also keeping a wary eye on the impact of higher crude prices on the U.S. shale patch.

The oil market is gearing up for the OPEC end of May gathering with two meetings planned on the day.

How OPEC's cuts have failed to eliminate the glut.

The only countries exempted from the production cuts are Nigeria and Libya.

Marzouq said there was a "noticeable increase in compliance from non-OPEC". US inventories of 532 million barrels remained near all-time records reached in March.

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