Oil prices decline

Brent crude futures

Oil prices have fallen after optimistic output forecasts by two big US producers and a build in weekly US crude stockpiles outweighed Opec-led production cuts.

Brent crude futures were at $65.42 per barrel, down 44 cents. US West Texas Intermediate (WTI) crude oil futures were down 89 cents at $55.67 per barrel.

Oil price rises

Getty Images

Oil prices are at their highest levels this year.

Brent crude futures are trading at more than $66 a barrel, up 0.6%, while West Texas Intermediate is 0.9% higher at just over $56 a barrel.

Supply cuts by Opec are among the reasons being cited as fuelling the rise.

Oil prices dip

oil pump
Getty Images

Oil prices have fallen after disappointing US factory data sparked fresh concerns about a slowdown in the global economy.

Brent crude futures dropped 0.2% to $62.6 a barrel, and US West Texas Intermediate fell 1.4% to $54.48 a barrel.

Weighing on oil markets, US government data showed new orders for US-made goods unexpectedly fell in November, with sharp declines in demand for machinery and electrical equipment.

Oil prices had been buoyed by a new round of supply cuts from Opec and its allies.

Oil prices climb after Opec production cut

Oil price chart

The oil price has risen almost 2% this morning to $58.13 a barrel.

That marks an increase of more than 8% since the beginning of the year, as the market absorbs cuts in Opec production that come into force this month.

OPEC deal will support US drilling

Oil rig
Getty Images

There has been mainly favourable reaction to an oil production cut agreed by OPEC and its allies, including Russia.

So far there has been no word (or tweets) from US President Donald Trump who has been calling for Saudi Arabia, the largest member of OPEC, to keep a lid on oil prices.

However, Ann-Louise Hittle, vice president of macro oils at Wood Mackenzie, says: "The decision is likely to be met with support from some US producers who were concerned that without a deal, West Texas Intermediate prices would fall further, possibly curtailing 2019 drilling activity."

She adds that the 1.2 million barrels per day cut in daily oil output would cause Brent crude to rise back above $70.