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Iranian crude oil continues its run into the bull-market territory on the back of a global pact to cut supplies that kicked in on January 1.
Its light crude traded at $53.31 in the week ending on Dec. 30. gaining $1.15 over the week. Iran Heavy. the country`s main export grade. also rose by $1.18 to $52.48.
Iran`s light and higher-value crude averaged $41 per barrel in 2016 and its heavy oil grade averaged $39.19.
Members of the Organization of Petroleum Exporting Countries struck a historic deal on Nov. 30 to slash collective output by 1.2 million barrels per day through the first half of 2017. Non-OPEC countries. including the world`s top producer Russia. joined the pact on Dec. 10. committing to a further production cut of 558.000 barrels a day.
Under the deal. Iran got exemption to raise production to 3.8 million barrels a day from slightly more than 3.7 million bpd that it produced in October.
Oil hit an 18-month high of $58.37 a barrel last week following reports that producing nations were mostly honoring their commitments. International oil benchmark Brent has gained more than 20% since OPEC reached the supply-cut deal in Vienna.
Production by the 13-member bloc started its downward trajectory last month.
Supply from OPEC in December fell to 34.18 million bpd from a revised 34.38 million bpd in November. the first since May. owing to attacks on Nigeria`s oil industry and top exporter Saudi Arabia trimming exports. according to a Reuters survey based on shipping data and information from industry sources.
OPEC said in a statement that the price of its basket of thirteen crudes stood at $52.71 a barrel on Wednesday. compared with $53.13 the previous day.
However. oil prices are still less than half of their peak level of $115 per barrel two and a half years ago.
Most forecasts expect oil to settle at a $50-60 per-barrel price range in 2017. Analysts say the OPEC and non-OPEC deal could be offset by higher supplies from shale oil producers who have found ways to adapt to low prices.
