Investing.com - Crude oil prices rose in Asia on Monday following a weekend meeting of OPEC ministers and counterparts from major producing countries who agreed a coordinated plant to trim global oil supplies is working well.
On the New York Mercantile Exchange, crude oil for delivery in March rose 0.21% to $53.30 a barrel. On the ICE Futures Exchange in London, Brent oil for March delivery was lastt quoted up 0.18% to $55.55.
"The deal is a success ...All the countries are sticking to the deal ...(the) results are above expectations," Russian Energy Minister Alexander Novak told reporters after the first meeting of a committee set up to monitor the deal.
OPEC members Nigeria and Libya, both suffering setbacks in production, were given exemptions from the OPEC leg of the cuts with Saudi Arabia bearing the lion's share for the cartel.
"The Kingdom [of Saudi Arabia] has taken the initiative and other countries took part in very significant actions," Saudi Energy Minister Khalid al-Falih told reporters following the meeting.
"Despite demand usually being lower in the first quarter in winter, the actions taken by the Kingdom and many other countries has impacted the market in a tangible way and we have seen the impact in spot prices."
Last week, oil futures finished higher on Friday, logging a modest weekly gain with traders encouraged by signs that global supply is tightening in wake of a planned agreement by major crude producers to cut output.
Oil jumped on Friday after Saudi Arabia's Energy Minister Khalid al-Falih, speaking at the World Economic Forum in Davos, said that 1.5 million barrels a day of the roughly 1.8 million in cuts pledged by OPEC and non-OPEC countries have already been taken out of the market.
The upbeat comments added to signs that the oil market is rebalancing.
Prices, however, finished off the session's highs after data showed a sharp weekly rise in the number of active U.S. rigs drilling for oil.
According to oilfield services provider Baker Hughes, the number of rigs drilling for oil in the U.S. jumped by 29 last week to 551, the largest weekly increase since a recovery in the rig count began in June and the highest level in around 14 months.
The data raised concerns that the ongoing rebound in U.S. shale production could derail efforts by other major producers to rebalance global oil supply and demand.
In a monthly report issued this week, the International Energy Agency said OPEC production has slowed, declining by 320,000 barrels a day to 33.09 million barrels in December.
January 1 marked the official start of the deal agreed by OPEC and non-OPEC member countries such as Russia in November last year to reduce output by almost 1.8 million barrels per day to 32.5 million for the next six months.
The deal, if carried out as planned, should reduce global supply by about 2%.
Some traders remain skeptical that the planned cuts will be as substantial as the market currently expects. Still, while some major oil producers, such as Saudi Arabia and Kuwait, have so far showed signs that they are sticking to their pledge to cut back output, others, such as Libya and Iraq have ramped up production.
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