Oil futures limped upward on Tuesday (14 February), after Saudi Arabia informed Opec that it reduced its crude production by the most in over eight years, above and beyond its obligations under a deal inked in November 2016.
Saudis said they had reduced output by 717,600 barrels per day (bpd) in January to 9.748 million bpd. In response, at 5:07pm GMT, the Brent front month futures contract was 0.38% or 30 cents higher at $55.89 per barrel, while the West Texas Intermediate was up 0.54% or 19 cents at $53.12 per barrel.
Last week, the International Energy Agency (IEA) said Opec producers were close to reaching their production cut target for 2017 outlined at their last meeting.
The IEA said the cartel had achieved 90% of its target of reducing headline oil production by 1.2m bpd to 32.5m bpd as stated on 30 November, 2016 in Vienna, Austria.
Meanwhile, with much of the market expecting higher US production, the country's Energy Information Administration said tight oil production will increase to more than 6 million bpd in the coming decade, making up most of total US oil production.
"After 2026, tight oil production remains relatively constant through 2040 in the Reference case as tight oil development moves into less productive areas and as well productivity decreases. Side cases with different resource and technology assumptions result in different tight oil and total US oil production projections."
Away from the oil market, precious metals headed sideways as the dollar saw mixed trading. At 5:28pm GMT, the Comex gold futures contract for April delivery was down 0.05% or 60 cents to $1,225.20 an ounce, while spot gold was 0.09% or $1.13 lower at $1,224.13 an ounce.
Robin Bhar, head of metals research Societe Generale, said gold prices remain at the mercy of risk appetite with the animal spirits that were unleashed last November following Donald Trump's election as US president still exerting a galvanising influence.
"Much now depends on how the latest political developments affect economic growth, inflation/inflation expectations and, in turn, US Federal reserve's policy and real rates. While perceived higher uncertainty strengthens the case for holding gold as a diversifier and hedge, possible changes in fiscal policy could push real rates higher, offsetting safe-haven demand and creating downside risks for gold."
Finally, Comex silver was up 0.22% or 4 cents to $17.86 an ounce, while spot platinum was 0.04% or 39 cents lower at $998.11 an ounce.