Oil futures rose Monday, lifted by supply concerns as Iraq reportedly planned production cuts and Libya saw disruptions to crude exports due to a pay dispute.
West Texas Intermediate crude
the global benchmark, was up 11 cents, or 0.2%, at $55.52 a barrel on ICE Futures Europe.
Iraq plans to produce 3.6 million barrels a day of oil in January and February, news reports said, which would fall below the 3.86 million barrels a day allowed under the agreement by the Organization of the Petroleum Exporting Countries and its allies, a group known as OPEC+. The deeper cuts aim to compensate for overproduction by the country in 2020.
“If Iraq manages to reduce output to these levels, it would be the lowest output we have seen from them since 2015,” said Warren Patterson, head of commodities strategy at ING, in a note. “However, given Iraq’s record of falling short with production cuts, there is no guarantee that they will meet this target.”
Meanwhile, Reuters reported that Libya’s Petroleum Facilities Guard halted all oil exports from the ports of Ras Lanuf, Es Sider and Hariga due to a pay dispute.
Libya had previously seen an “exceptional” recovery in oil output, Patterson noted, hitting more than 1.2 million barrels a day in December after producing less than 100,000 barrels a day in August.