Tight global supplies and global political tensions have boosted oil prices by about 15 percent so far this year. Demand remains on the upswing, with the Omicron variant only temporarily denting consumption in major economies.
Oil prices edged higher on Thursday, maintaining the market's upward trajectory built on expectations that supply will continue to tighten even after OPEC+ producers stuck to planned moderate output increases.
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The Organisation of the Petroleum Exporting Countries and allies led by Russia, known as OPEC+, agreed on Wednesday to stick to monthly increases of 4,00,000 barrels per day (bpd) in oil output despite pressure from top consumers to raise output more quickly.
"With OPEC+ unwinding their production cuts, the group's spare capacity will fall to low levels in 2022. Hopefully by next year there are no mobility restrictions, meaning with the world still expanding oil demand will also rise next year," said Giovanni Staunovo, commodity analyst at UBS.
Brent crude was up 47 cents, or 0.5 percent, to $89.87 a barrel. US West Texas Intermediate crude rose 60 cents, or 0.6 percent, to $88.76 a barrel.
Goldman Sachs analysts forecast Brent topping $100 a barrel in the third quarter. The brokerage had predicted that OPEC+ may consider a faster unwinding of its production cuts.
However, several OPEC members are struggling to pump more despite prices being at seven-year highs.
Iraq pumped 4.16 million bpd of oil in January, below its allowed limit of 4.28 million bpd under the OPEC+ deal, data from state-owned marketer SOMO seen by Reuters showed.
An explosion rocked an oil production vessel owned by Nigeria's Shebah Exploration & Production Company Ltd (SEPCOL) with a 22,000 bpd capacity, the company said on Thursday.
The blast is unlikely to have any major impact on output although Nigeria has already been struggling to meet its production quota under the OPEC+ deal due to under-investment.
Cold weather forecasts for the central United States and parts of the Northeast this week also gave prices a floor.
US crude stockpiles fell by 1 million barrels last week, the Energy Information Administration said on Wednesday, while distillate inventories also dropped amid strong demand both domestically and in export markets.
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