Oil futures rose Tuesday, with expectations that efforts by major oil producers to reduce production will lead to tighter global supplies lifting USA prices to their highest settlement in more than a year.
OIL prices rose around 1 per cent on Tuesday after major crude producers showed they were reining in output roughly in line with their commitments, extending gains for a market thrown out of kilter by weak demand during the coronavirus pandemic.
Also supporting prices, U.S. crude oil stockpiles fell by 994,000 barrels last week to 475.7 million barrels, their lowest since March, the U.S. Energy Information Administration said on Wednesday.
Brent crude futures rose 16 cents, or 0.3%, to $57.62 a barrel, in a fourth straight day of gains after hitting $58.05 on Tuesday, its highest in more than 11 months.
An OPEC+ ministerial meeting will be held Wednesday to review the oil market.
"With OPEC and its allies (OPEC+) endeavoring to keep global oil production below demand, we expect petroleum inventories to keep failing", UBS said in a note.
U.S. West Texas Intermediate (WTI) crude futures climbed 40 cents, or 0.7%, to $55.16 a barrel, having hit a one-year high at $55.28 a barrel earlier on Wednesday.
"So I think that's certainly buttressing demand hopes, together with impacts from stimulus", NAB's Shaw said.
The OPEC+ panel meets next on March 3, which is expected to be followed by a full OPEC+ gathering to decide policy.
Russian output increased in January but in line with the agreement on reducing production, while in Kazakhstan oil volume fell for the month.
Meanwhile, global stocks remained firm on Tuesday, with benchmark US stock indexes moving up as investors have been encouraged by news on the pace of vaccine rollout in the USA and the prospect of more fiscal aid from Congress, which may speed the economic recovery and energy demand.
USA government data is due at 1530 GMT from the Energy Information Administration.
On average, the EIA is expected to report a decline of 2.4 million barrels in crude supplies for the week ended January 29, according to an S&P Global Platts survey.
Gasoline stocks fell by 240,000 barrels, defying analysts' expectations for a build of 1.1 million barrels, while distillate inventories, which include heating oil and jet fuel, fell by 1.6 million barrels, a bigger draw than expected.