Oil price climbs as Opec offers early consensus on renewed deal

High U.S. gasoline stocks have fed some concern about demand in the United States, where consumer spending expectations hit a three-year low last month and vehicle sales have fallen year-on-year for four months in a row.

Investors should note that on November 30, 2016, the OPEC cut a deal, per which, the bloc would have cut production by about 1.2 million barrels a day from January (read: How Effective is the OPEC Deal for an Oil ETF Rally?).

Saudi Arabia's oil minister said he is confident that an agreement by oil producers to curb output and shrink a market glut will be extended into the second half of the year and possibly beyond. Aramco had previously maintained supplies to important Asian customers.

Supply from the 11 OPEC members with production targets under the accord - all except Libya and Nigeria - fell to 29.674 million bpd last month, according to figures from secondary sources that OPEC uses to monitor output.

The oil ministers of the two countries held a press conference in Baghdad where Iraqi Oil Minister Jabar Ali al-Luaibi said "there might be new ideas to be presented" at an OPEC meeting on May 25, without providing further details.

West Texas Intermediate crude oil traded up 1.6% at $46.94 a barrel after weekly US Energy Information Administration inventory data showed a bigger drawdown than expected.

The news agency reported that state-owned Saudi Aramco will reduce oil supplies to its Asian customers by almost seven million barrels next month as it is likely to witness a surge in domestic power demand over summer.

Global benchmark Brent crude was up 54 cents at $49.27 a barrel by 1102 GMT.

BMI said that "continued output growth. particularly in the US" would cap price upside gains from the supply cuts, adding that it expected average 2017 prices of $57 a barrel for Brent and of $53.75 a barrel for WTI.

Russian Federation also said it was discussing prolonging cuts with other producers beyond 2017. Atkinson said such a move will see the supply deficit become even bigger in the second half of the year.

The EIA forecast that USA oil demand for 2017 will grow 290,000 bpd, up from its previous forecast for 250,000 bpd growth.

The May report also changes to the EIA's earlier estimates for crude oil and refined product pricing for 2017.

The Organisation of Petroleum Exporting Countries (OPEC) has called on U.S. shale oil drillers to cut output for the prosperity of global economy.

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