May 17 (UPI) -- Support for an extended OPEC-led effort to balance the market with production declines helped boost oil prices Wednesday despite a build in U.S. supplies.
Russia and Saudi Arabia started off the rally this week by supporting a move to extend the effort from the Organization of Petroleum Exporting Countries into March, three months longer than initially planned. Non-OPEC members have since followed Russia's wake and Kuwait's oil minister said Tuesday his country was firmly behind the proposal.
"One cannot help but think that there is a broad consensus and strong will to 'do whatever it takes' to deplete global oil inventories," Tamas Varga, an analyst with London brokerage firm PVM, said in a daily newsletter.
The price for Brent crude oil was up about 0.45 percent a half hour before the start of trading in New York to $51.88 per barrel. West Texas Intermediate, the U.S. benchmark for the price of oil, was up 0.27 percent to $48.79 per barrel.
Brent crude oil topped $52 per barrel briefly this week, but came under pressure late in the trading day Tuesday when the American Petroleum Institute reported a build of crude oil inventories in the United States of 882,000 barrels. That compared to a draw forecast by S&P Global Platts of around 2 million barrels.
The morning rally will be tested by official supply and demand data from the U.S. Energy Information Administration. Demand in the United States could tick upwards in the week leading up to the long Memorial Day holiday weekend, considered the official start to the summer travel season in the world's leading economy. Motor club AAA said it expected an increase in travel of about 2 percent.
Elsewhere, global stock markets could react negatively to the latest turmoil surrounding U.S. President Donald Trump. Allegations have surfaced the president may have tried to influence an ongoing investigation into Russian activity in the U.S. election process.
Phil Flynn, a senior market analyst for the PRICE Futures Group in Chicago, said in a daily newsletter the controversy could undermine confidence in Trump's economic growth agenda.
"It matters for oil because if these latest charges slow down Donald Trump's pro-growth agenda, it could hurt oil demand going forward and slowdown the oil rebalancing process," he said.