By Nigar Abbasova
The situation in the world energy market is still volatile as record stockpiles do not let prices to receive significant gains from OPEC led efforts to curb global glut.
Crude prices were near multi-week highs on February 22, with Brent crude trading at $56.90, recording an increase of 24 cents, and the U.S. West Texas Intermediate standing at $54.51 a barrel, some 18 cents up from the previous close, Reuters reported.
OPEC Secretary General Mohammad Barkindo told an industry conference in London that January data showed conformity from participating OPEC nations with output curbs had been above 90 percent and oil inventories would decline further this year.
"All countries involved remain resolute in the determination to achieve a higher level of conformity," Barkindo said, mentioning that in the short term, the OPEC and non-OPEC cooperation is expected to speed up the rebalancing of the oil market.
OPEC sources earlier said that extending or deepening the cut was a possibility if stocks do not fall. Commenting on the issue Barkindo said that it would be very premature to say if the supply cut, would need to be extended or deepened at the next OPEC meeting in May.
Despite Barkindo’s comments, analysts are still doubtful about the further compliance of oil producers as the output levels may increase triggered by higher oil prices and expected high demand, as the summer is approaching.
Besides, the soaring. inventories are still posing a certain threat to the process of stabilization. Inventory levels are still very high in many parts of the world, particularly in the United States. U.S. crude oil and gasoline inventories reached record highs last week, as refineries cut output and gasoline demand softened.
Nigar Abbasova is AzerNews’ staff journalist, follow her on Twitter: @nigyar_abbasova
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