Oil prices rose Tuesday, helped in part by the continuing outage of a North Sea pipeline and reports that Russia's largest oil company could envision continuing production curbs past 2018.
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U.S. crude futures traded up 30 cents, or 0.52%, at $57.46 a barrel on the New York Mercantile Exchange. Brent, the global benchmark, rose 39 cents, or 0.62%, to $63.80 a barrel on ICE Futures Europe.
Russian oil giant PAO Rosneft is "contemplating cuts beyond 2018, which is probably supporting things a bit," said Thomas Pugh, commodities economist at Capital Economics.
The Organization of the Petroleum Exporting Countries and 10 producers outside the cartel, including Russia, agreed late last month to extend an accord to hold back nearly 2% of crude production through the end of 2018. The deal, first agreed a year ago, was meant to rein in a global supply glut that has weighed on prices since 2014.
Pavel Fedorov, PAO Rosneft's first vice president, reportedly said that an OPEC-led agreement to curb crude output "could be extended" after it expires at the end of next year, according to Reuters.
Oil prices have also been propped up since the closure of the Forties Pipeline System in the North Sea last week. The outage, which could last for weeks, stops the flow of around 450,000 barrels of North Sea oil a day.
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"It's not still driving prices up, but its supporting them where they are," Mr. Pugh said of the Forties disruption.
Ineos, the company that owns the system, said Tuesday that custom parts needed to repair the pipeline had been created and are being delivered in the coming days. The company said there was no change to its previous timeline for repair, of two to four weeks from Dec. 11.
"I think everyone is continuing to keep a close eye on the progress Ineos is making," said John Kilduff, founding partner of Again Capital.
Also lifting prices Tuesday are expectations that U.S. crude stockpiles will shrink again in data due for release Wednesday. Analysts surveyed by The Wall Street Journal predicted that crude stockpiles fell by 3.2 million barrels last week -- that would be the fifth straight week of declines.
The American Petroleum Institute, an industry group, said late Tuesday that its own data for the week showed a 5.2-million-barrel decrease in crude supplies, a 2-million-barrel rise in gasoline stocks and a 2.9-million-barrel fall in distillate inventories, according to a market participant.
Oil prices have risen more than 20% since September, helped by greater compliance with the OPEC-led production curbs, as well as renewed geopolitical risks that could threaten global supplies.
One geopolitical hot spot again on the horizon for oil market watchers is Iran, analysts say.
U.S. President Donald Trump, who earlier this year refused to recertify an international agreement with Iran to curb the Islamic Republic's nuclear efforts, could potentially reinstate economic sanctions on the country next month.
"The threat of a renewal of U.S. sanctions looms large," Stephen Brennock, an analyst with brokerage PVM Oil Associates Ltd., wrote in a note Tuesday. "Set against this uncertain backdrop, Iran will continue to represent a long-term threat to supply," he said.
In addition, Saudi Arabia said Tuesday that it intercepted a ballistic missile fired by Yemen's Houthi rebels over its capital city -- the second such incident in two months. Saudi Arabia views the Houthis as proxies of Iran, and analysts said the missile could further strain the relationship between Iran and Saudi Arabia.
Still, the prospect of higher output from the U.S. has capped gains.
"The market focus is currently on production outages in the North Sea, but might shift back to strong U.S. shale production growth," Giovanni Staunovo, an analyst at UBS Wealth Management, wrote in a research note.
Gasoline futures rose 2.41 cents, or 1.44%, to $1.6966 a gallon. Diesel futures rose 1.47 cents, or 0.76%, to $1.9399 a gallon.
Asa Fitch contributed to this article.
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(END) Dow Jones Newswires
December 19, 2017 16:59 ET (21:59 GMT)