Oil gains after Goldman Sachs predicts rise above $80

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Oil gains after Goldman Sachs predicts rise above $80

The nation produced 10.038 million barrels of oil per day in November, according to the Energy Information Administration's monthly production data report released Wednesday - 48 years to the month since the USA last reached 10 million barrels per day. New Mexico produced 528,000 barrels per day in November, the same tally as in October.

Though he said he believes that the market remains oversupplied, he added that ultralight crudes "have a different market from crude below 40 degree API".

In January of 2017, when oil prices were trading at around $50.00, the regional production was 621,000 barrels a day.

Investor sentiment was also boosted by Goldman Sachs' outlook.

With investors now pondering which of oil's current key driving forces will prove to be the dominant one - rising USA crude output, or OPEC's adherence to its supply cuts - the relationship with equities and even the dollar is likely to erode. "Crude oil imports are down 20 percent from 2006 and, today, we are competing with the Middle East in the export market". The rocky mountain region of the U.S.is known for its shale oil production.

Goldman's short-term optimism presumably baffles Tom Kloza, global head of energy analysis at the Oil Price Information Service: he told CNBC that crude has entered a danger zone due to "the tremendous speculative bubble and the money on the crude oil side". Oil and Gas Journal economist Conglin Xu said that will see the US overtake Saudi Arabia and possibly Russian Federation.

Crude for March delivery rose 18 cents, or 0.3 percent, to $64.91 a barrel after ending the last session up 0.4 percent. According to the EIA, global oil demand increased to 98.38 million barrels a day in 2017 up from around 92 million barrels of oil a day in 2015.

Industry experts believe the USA may be the world's top crude oil producer this year, a possible boon for Oklahoma's energy-reliant economy. West Texas Intermediate, the US benchmark for the price of oil, was up 0.9 percent to $65.31 per barrel. The investment bank said Brent likely will average $75 a barrel over the next three months, up from an earlier forecast of $62.

"There's no doubt shale players will respond to higher prices", says Jan Edelmann, commodity analyst at HSH Nordbank AG.

Others, however, point to growing global demand and declining production in most countries other than the United States, Russia and Saudi Arabia. As a result of the work week ended on January 26, the number of drilling rigs increased by 11 units, or by 1.17 percent, to 947 units. "The torrid pace of production growth of nearly 850,000 bpd since late summer underscores the anti-fragile nature of production in a rising price environment despite a stagnant rig count", RBC analysts said.

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