At year-end, West Texas Intermediate (WTI) crude futures settled at $60.42, the highest close since June 2015. Brent crude futures were at $66.62 a barrel, after briefly crossing $ 67. This 17 percent rise in Brent prices was supported by ongoing supply cuts by OPEC and Russia as well as strong demand from China.
WTI prices were supported by data from the U.S. Energy Information Administration late on 28 December showing that domestic oil production declined last week to 9.75 million barrels per day (bpd) from 9.79 million bpd in the previous week. WTI prices were further boosted by an EIA report of a 4.6 million barrel weekly drop in U.S. commercial crude storage levels. Inventories are down by almost 20 percent from historic highs last March, and well below this time last year or in 2015. Analysts expect US production to top 10 million bpd in the next few weeks and to keep growing, limiting efforts by other producers to cap global supplies.
January 2, 2018