Oil Settles Higher In U.S.

Oil closed slightly higher in the U.S. on Tuesday with estimates of U.S. crude and refined product stocks ahead from the American Petroleum Institute to set the tone. Oil settled weaker in the U.S. on Monday after a forecast by the government showed an expected higher production level from U.S. shale drillers in response to higher prices.

On the Intercontinental Exchange in London, Brent for April delivery rose 0.68% to settle at $55.97 a barrel. On the New York Mercantile Exchange, crude oil for delivery in March gained 0.51% to $53.20.

The API will report its figures for inventories at the end of last week later on Tuesday, while official data from the U.S. Energy Information Administration (EIA) is due on Wednesday. A poll of analysts sees crude oil inventories up 3.175 million barrels, while distillates and gasoline supplies are each seen down by 1.15 million barrels.

Last week, crude oil inventories in the U.S. jumped by 13.8 million barrels, the EIA said, a surprise above the expected 2.8 million barrels gain. Also last week, API reported a 14.23 million barrels build in crude stocks.

On Monday, OPEC said overall output by the cartel members in January fell 890,000 barrels per day (bpd) from December to 32.14 million (bpd), putting the supply and demand balance globally on track to even out this year from a glut. OPEC has agreed to cut 1.3 million bpd and a group of other producers led by Russia will cut by 558,000 bpd in the first six months of the year.

By Bryan Smith