Azerbaijan presented OPEC with January oil output data

He also attributed the climb to bullish production data.

With uncertainty over the final outcome of OPEC's cuts and also little known so far regarding Russia's commitments to its supply reductions, crude futures have been range-bound, trading within a $2 per barrel range over the past week, and within $1.25 a barrel since Monday.

About 617,000 barrels of oil, 50,800 barrels of condensate and 24,200 barrels of oil products were daily exported, according to the ministry.

Also feeding into trading sentiment was government data released on Wednesday which showed that USA inventories of crude oil rose by 6.5 million barrels to 494.8 million barrels in the week ended January 27, according to the Energy Information Administration's (EIA) weekly oil report.

"U.S. crude could be in consolidation from $51 to $55 for a while, until there's more evidence on OPEC production cuts or more evidence of production picking up or stabilizing in the USA", said Bill Baruch, senior market strategist at iitrader.com.

Meanwhile, Lee Saks has some comments from the former God of Crude Oil, Andrew Hall, who says that if oil stays in contango the ceiling will be $55 but if it goes into backwardation, he sees mid-$60s by the middle of this year.

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A Reuters survey, published this week, showed at the end of January OPEC members cut production by 958,000 barrels per day, equating to an 82 percent compliance of what they initially pledged.

Oil prices have increased after proof that OPEC and other key producers have been reducing output as agreed outweighed an increase in United States crude inventory.

The cuts by Russian Federation and the Organization of the Petroleum Exporting Countries follow last year's agreement to lower supplies by a combined 1.8 million bpd to prop up prices that still are half their mid-2014 levels.

Russian Federation could move quicker than expected on trimming oil production under the terms of an OPEC-led agreement, the country's energy minister said Thursday. The contract settled up $1.22 a barrel at $56.80 on Wednesday.

The six-month agreement had its first test in January.

  • Rita Burton