Oil slips near $57 on OPEC-cuts review

Bloomberg

Oil slipped to near $57 a barrel as US drilling expanded and OPEC nations Kuwait and the United Arab Emirates signalled they can phase out production cuts if the market improves.
Futures fell 0.4% in New York after climbing 2.5 percent in the previous two sessions. Drillers boosted the rig count by two to 751, a three-month high, according to Baker Hughes data. OPEC-led output curbs may end earlier than scheduled if the market
re-balances by June, Kuwait Oil Minister Issam Almarzooq said.
Oil is heading for a second yearly gain as the Organization of Petroleum Exporting Countries and its allies including Russia extend supply cuts through to the end of 2018. The extension included an agreement to review the cuts in June, raising questions of how OPEC will eventually phase out the reductions.
Shale explorers have signaled they’re gearing up for a drilling surge next year as hedging rose for an eighth week to a record. “If inventories fall a lot now, then the chance increases of OPEC phasing out cuts earlier than they have recently said,” according to Jens
Pedersen, senior analyst at Danske Bank A/S.
“The market is figuring out which stance to take on this. That said, it’s still a long way until the June review meeting.”
West Texas Intermediate for January delivery was at $57.13 a barrel on the New York Mercantile Exchange, down 23 cents, at 10:04 a.m. in London. Total volume traded was about 2 percent above the 100-day average. Prices rose 67 cents to $57.36, trimming the weekly loss to 1.7 percent.
Brent for February settlement fell two cents to $63.38 a barrel on the London-based ICE Futures Europe exchange. Prices slid 0.5 percent last week. The global benchmark traded at a premium of $6.17 to February WTI.