Oil Steady After Biggest Weekly Gain Since 2009

Oil Steady After Biggest Weekly Gain Since 2009Oil Steady After Biggest Weekly Gain Since 2009

Oil prices steadied at around $53.50 a barrel on Friday after the biggest weekly rally in seven years following OPEC's decision this week to cut crude output in order to rein in a global glut.

The market focus now shifts to the implementation and impact of OPEC's first production agreement since 2008, which will be joined by non-OPEC producers, after data showed output in Russia rose in November to a post-Soviet high, Reuters reported.

Front-month Brent crude futures were down 45 cents, or 0.8% from their last settlement at $53.49 per barrel. The contract was up more than 13% this week, its biggest gain since March 2009.

US West Texas Intermediate futures were at $50.68, down 38 cents.

The Organization of the Petroleum Exporting Countries, which accounts for a third of global oil supply, will reduce production starting in January by 1.2 million barrels per day, or over 3%, to 32.5 million bpd.

Russia also agreed to cut output by 300,000 bpd. Russia and other non-OPEC producer are set to meet with OPEC on Dec. 9.

"The lack of firm output commitments from some non-OPEC producers may not be a major source of concern, but the threat posed by non-compliance and the potential for US shale operators to spoil the party should not be ignored," brokerage PVM Oil Associates said.

"Pockets of unease are already apparent and following the knee-jerk reaction that has produced unsustainable double-digit percentage price gains, signs are that the OPEC-induced euphoria is fading this morning with both crude benchmarks opening on a softer note," PVM added.

Russia said on Friday that its output in November rose slightly to 11.21 million bpd.

Analysts said there was still a possibility that oversupply, which has halved oil prices since 2014, remains in place next year.

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