Mubasher: Oil prices went up on Thursday amid on-going efforts by the Organization of Petroleum Exporting Countries (OPEC) to reduce supply and US sanctions against Iran and Venezuela.

However, a record crude output in the US and a surge in its commercial fuel stockpiles kept a lid on price gains.

By 7:52 am GMT, US Nymex crude futures inched up 0.02% to $56.23 per barrel (pb), while international benchmark Brent futures rose 0.20% to 66.12 pb.

Crude markets had support from the supply-cutting pact inked by OPEC and its partners, including Russia, an alliance known as OPEC+, under which supply was reduced by 1.2 million barrels per day (bpd) in an attempt to prevent a market glut.

“In our view, OPEC’s strategy is to rebalance the market as quickly as possible and exit the cuts by the end of June in order to grow production alongside shale producers in the second half of this year,” Goldman Sachs said.

US sanctions against the hydrocarbon sectors of oil-rich Iran and Venezuela have given prices a push, traders told Thomson Reuters.

In Venezuela, an OPEC member, state-run oil company Petroleos de Venezuela (PdVSA) declared a maritime emergency this week, due to a trouble in accessing carriers and personnel to ship its crude barrels under the sanctions.

That said, oil market remained amply-supplied owing to a surge in US production.

US crude stockpiles jumped much more than expected last week, as inventories up by 7.1 million barrels to 452.9 million barrels, according to a weekly report by the Energy Information Administration (EIA).

US crude production also stood at a record 12.1 million bpd, an increase of over 2 million bpd since early last year.

Adding to that, the easing of a transportation bottleneck for US Permian Basin shale oil could result in higher output, Goldman said.

“The balance between rising US production and the OPEC+ efforts to stabilize prices with a production cut was broken by higher than expected U.S. inventories and the [Organisation for Economic Co-Operation & Development] warning of lower global growth impacting energy demand going forward,” futures brokerage OANDA senior analyst Alfonso Esparza said.

The OECD on Wednesday predicted that the global economy would expand 3.3% this year, 0.2% down from its set of projections last November.