Crude oil futures recovered during European trading Friday morning following the overnight plunge, getting a lift from rising equity markets, analysts said. At 1052 GMT, ICE February Brent crude futures were 81 cents higher at $52.97/b, and the NYMEX January light sweet crude contract was up 95 cents at $45.56/b. US equity markets rallied Thursday afternoon, recovering the losses from earlier trading. The Dow Jones Industrial Average were roughly 1.1% higher at the settle on Thursday.
Crude prices should find further support in the first quarter of 2019 as OPEC cuts are expected to rebalance the market. Kuwait’s new oil minister, Khaled al-Fadhel, pledge of commitment to OPEC production cuts also lent support to prices. Kuwait is a founding member of OPEC and is closely aligned to Saudi Arabia and the core Persian Gulf states within the group.
However, the oil market has been rather bumpy, with oil prices falling from $86/b in October to close to $50/b in recent days despite OPEC+ embarking on a new output cut deal to take 1.2 million b/d out of circulation next year. Another source said the increase in prices could merely be due to end-of-year adjustments.