NEW YORK, Jan. 12 (UPI) -- Crude oil prices were in clear positive territory before the U.S. open Thursday after OPEC signaled stronger compliance with managed declines.
A survey of December production data from members of the Organization of Petroleum Exporting Countries by S&P Global Platts found cumulative output was moving lower and close to the target cap of 32.5 million barrels per day.
A November agreement by OPEC, followed by a December arrangement with non-OPEC producers like Russia, is aimed at correcting a market tilted heavily toward the supply side. High OPEC production levels, and output from U.S. shale basins, flooded the market and sank crude oil prices below $30 per barrel in early 2016.
OPEC leaders gathered at an energy summit in Kuwait stressed their commitments to the managed decline. Kuwait is a member of a panel monitoring compliance.
Kuwait was one of the first to confirm compliance and now Saudi Arabia said it's production is now at just less than 10 million barrels per day, a 22-month low.
Oil prices were moving in positive territory in the hour before the open of trading in New York. Brent crude oil was trading up 1.8 percent to $56.11 per barrel. The February contract for U.S. oil, West Texas Intermediate, gained 1.6 percent to trade at $53.10 per barrel.
Both contracts are below the point at which they started the year.
Saudi Oil Minister Khalid al-Falih was quoted by Bloomberg as saying the market correction wasn't happening fast enough and further support may be given to the production agreement.
"We have been moving toward a re-balanced market for some time -- too slowly to my liking," he said from Kuwait. "The pace of re-balancing will be accelerated due to the recent agreements within OPEC and with our party from outside [the group]."
Crude oil prices are at a point where some operators in U.S. shale oil basins are returning to work after standing down in the weak 2016 market, a situation that may present a ceiling for oil prices. The U.S. Energy Information Administration this week revised its forecast to show an increase in total production this year. A forecast from as recently as December predicted a decline in oil production from 2016 levels.
OPEC and non-OPEC members meet Jan. 22 in Vienna to review compliance.