Crude Oil Update

Crude oil is lower as market dismisses decision by Nigeria and Venezuela on Friday to cut production by combined 170k bpd.

The significance of the cut seems negligible given both these countries produce less than its OPEC quota levels, in particular Nigeria, where pipelines have been attacked by militants/rebels.

Moreover, the planned cuts are insignificant, given the cartel is still pumping around 28mln bpd, and there is a global oil surplus of at least 500k bpd, according to Venezuelan oil minister Rafael Ramirez.

Saudi Arabia, Kuwait, and the UAE all produce well above their quotas. Traders continue to look for crude oil prices to ease below $60.00 level, as speculators attempt to test the OPEC's resolve. WTI Nymex crude oil is currently at $62.49, down 42 cents.