What Apple's Tailspin Means For Oil Prices

Goldman cuts 2019 crude price view; sees recovery from current levels

International Brent crude futures gained 55 cents to $57.88 per barrel by 0945 GMT.

With drilling activity still high, most analysts expect United States oil production to rise further this year.

The coalition of 25 OPEC and non-OPEC states, which came together for the first time in late 2016 to slash global oil supplies in order to reverse a three-year oil price slide, agreed last month to once again cut their collective output by 1.2 mmbbl a day in 2019 which should be sufficient to keep oil prices above US$60 a barrel this year, according to 74 per cent of those surveyed in the GIQ survey. West Texas Intermediate futures were up 2.81% at $49.31 a barrel.

Oil has gained almost 12 per cent since last Monday, its biggest week-on-week rally since early December 2016.

Moving forward, the American Petroleum Institute will publish its weekly report on USA crude oil supplies ahead of tomorrow's official DoE report.

Crude prices so far in 2019 have been buoyed by supply cuts from the Organization of the Petroleum Exporting Countries including top exporter Saudi Arabia, as well as non-member Russian Federation.

Oil closed at a three-week high as USA negotiators touted progress in trade talks with China and investors gained faith that OPEC will shrink output.

Consultancy JBC Energy said it was likely that U.S. crude oil production was already "significantly above 12 million bpd" by early January.

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OPEC and non-OPEC members will meet in Vienna, Austria, on Thursday, with the aim of reaching an accord over possible output cuts in order to prop up tumbling oil prices.

Rising optimism on a potential US-China trade deal continues to morph into extra oxygen for the risk-associated complex, in turn pushing prices of the American reference for the sweet light crude oil to fresh multi-day peaks in levels just shy of the $50.00 mark per barrel.

Easing US-China trade tensions would underpin oil at current levels.

"When stock markets are strong oil usually follows suit", PVM Oil Associates strategist Tamas Varga said.

The market has anticipated that talks between Chinese officials and the USA trade representatives that began on Monday would yield positive results, as smooth global trade would help encourage oil demand.

A steep rise in onshore shale drilling has helped make the United States the world's top producer, with crude production C-OUT-T-EIA up 2 million barrels per day (bpd.) previous year to a world record 11.7 million bpd.

Societe Generale cut its 2019 oil price forecast for Brent by $9 to $64 a barrel and reduced its forecast for USA light crude by $9 to $57 a barrel.

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