This report has been corrected to clarify that OPEC members, not OPEC and its allies, pumped 28.9 million barrels per day in September, the lowest monthly figure since 2011.
Crude-oil futures headed higher on Tuesday to start the month, staging a recovery amid reports of weakening output in September from members of the Organization of the Petroleum Exporting Countries.
West Texas Intermediate crude for November delivery CLX19, +0.39% gained 53 cents, or 1%, at $54.60 a barrel on the New York Mercantile Exchange, after notching on Monday the lowest front-month contract finish since Sept. 3, according to Dow Jones Market Data.
December Brent crude BRNZ19, +0.78% advanced by 63 cents, or 1.1%, to trade at $59.88 a barrel on ICE Futures Europe on its first full trading day as a front-month contract.
WTI, based on front-month contract prices, saw a 1.9% monthly decline, and lost 7.5% for the quarter. Brent scored a 0.6% monthly climb, but ended down 8.7% for the quarter.
A monthly Reuters survey showed that production from members of the Organization of the Petroleum Exporting Countries hit its lowest level in eight years in September. The report indicated OPEC output was at 28.9 million barrel a day, down 750,000 barrels per day from a lowered figure in August and the lowest monthly total since 2011.
Reuters also reported that output from non-OPEC Russia fell to 11.24 million barrels a day in September, down from 11.29 million in August.
Meanwhile data from the Energy Information Administration showed U.S. crude output down 276,00 barrels a day to 11.81 million barrels a day in July.
“[U.S. oil] is up around 1% today on news that OPEC, Russia, and the U.S. have all cut production in latest reports available,” wrote Robert Yawger, director of energy at Mizuho USA.
Still, traders continued to weigh global trade tensions and the prospect of disruptions to the world’s supply of oil against the potential for a slowdown in energy demand.
With OPEC and its allied producers “maintaining a holding pattern on its existing supply cuts programme, global trade tensions continue to drive sentiment surrounding oil,” wrote Han Tan, market analyst at FXTM, in a market update.
“Even though investors are wary of any sudden spike in geopolitical tensions that could tighten global oil supplies, the upside for oil will be limited unless worldwide demand is given a valid reason to rebound significantly in 2020,” he said.
On Monday, U.S. prices came under fresh pressure after Saudi Aramco Trading’s Chief Executive Officer Ibrahim al-Buainain confirmed that the state-owned operation had restored full output capacity on Sept. 25, to the level before the Sept. 14 attacks on Saudi facilities, according to Reuters. The news report said that when asked if output was at 9.9 million barrels a day, al-Buainain said it was restored to its “target” level or even “a little higher.”
The attacks on the Saudi facilities, which the U.S. and Saudi Arabia have blamed on Iran, had briefly knocked more than 5 million barrels a day of Saudi crude production offline.
Looking ahead, the market awaits the latest weekly updates on U.S. petroleum supplies due out from the American Petroleum Institute late Tuesday and the EIA Wednesday morning.
Crude supplies for the week ended Sept. 27 were forecast to climb by 1.3 million barrels, on average, according to analysts polled by S&P Global Platts. The survey also revealed expectations for a supply climb of 308,000 barrels for gasoline and a decline of 2.2 million barrels for distillates.
November natural gas NGX19, -2.15% traded at $2.295 per million British thermal units, down 1.5%.