Stocks fell in Europe as investors locked in gains on this year's strong run, while oil prices rose after US fuel inventories declined and Saudi Arabia cut supplies of crude to Asia by more than expected.
Even though OPEC has stuck to its pledge to cut production, USA output C-OUT-T-EIA has risen by more than 10 percent since mid-2016 to 9.3 million barrels per day, close to the output of Russian Federation and Saudi Arabia. Traders were looking for a draw of 1.8 million barrels.
US crude output has grown by over 10% since mid-2016 but didn't let oil prices to surge.
But global inventories remain high, pulling crude back below $50 per barrel and putting pressure on Opec to extend the cuts to the rest of the year.
Iraq and Algeria said Thursday, May 11, 2017, that they support the extension of oil production cuts by OPEC and non-OPEC producers through the end of the year to try to boost prices.
As a result, global benchmark Brent crude was up $1.24, or 2.5% at $49.97 USA a barrel mid-morning Wednesday.
Production rose, however, and gasoline demand over the last four weeks was 2.5 per cent lower than at the same time period a year ago.
"It is hard to see how the day's gains last".
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The euro too is expected to gain ahead as Macron is a follower of the European Union unlike Le Pen who is in favor of "Frexit". Macron has vowed to implement reforms that would make the French economy more competitive.
Besides, resilient US shale output, sluggish demand from American drivers, which have kept USA stockpiles at historically high levels, besides ongoing economic rebalancing efforts in China has further constrained oil consumption growth, putting tremendous pressure on the OPEC.
Brent crude has endured a volatile past few years, plummeting from more than $100 a barrel in 2014 to less than $30 last year.
"Based on consultations that I've had with participating members, I am confident the agreement will be extended into the second half of the year and possibly beyond", said Mr. Al-Falih.
The IEA now sees global oil demand growth of 1.3 million barrels a day, lower than the growth of 1.6 million seen in 2016 and the 2 million recorded in 2015.
Oil resumed gains after industry data showed US crude stockpiles declined, trimming an inventory overhang. Atkinson said such a move will see the supply deficit become even bigger in the second half of the year.
Official numbers on weekly United States crude and oil product inventories from the United States government's Department of Energy were scheduled for release at 1430 GMT on Wednesday.
The company had previously been maintaining its exports to Asia despite production curbs.
Nigeria, which along with Libya is exempt from OPEC cuts, is also expected to see a jump in output soon as Shell (LSE: RDSB.L - news) tests the Trans Forcados oil export pipeline before it restarts.
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