Oil ticks higher, market eyes US State of the Union address

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Both U.S. crude oil imports and exports increased during the week ending February 1, the U.S. Energy Information Administration (EIA) said on Wednesday.

"The large draws in distillate ... made sure that commercial oil inventories fell for the second week, this time by 3.4 million barrels", he said.

OPEC oil supply fell in January by the largest amount in two years despite sluggish production declines from Russian Federation, according to a Reuters survey.

Brent crude oil futures were last down $0.12 at $62.57 a barrel by 1022 GMT, while U.S. crude futures were down $0.07 at $53.94 a barrel.

In the Annual Energy Outlook 2019 released last month, EIA forecast that the United States will become a net energy exporter in 2020 thanks to its increased crude oil production and decreased domestic consumption of petroleum products.

Providing global markets with price support are supply cuts led by the Organisation of the Petroleum Exporting Countries (OPEC) aimed at tightening the market.

"You have the sanctions on Venezuela, on top of the reduced supply from Saudi Arabia", Olivier Jakob, oil analyst at Petromatrix, said as cited by Reuters. "There's no sign of overhang in the crude oil markets".

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Worries about weaker global economic growth and the trade dispute between the United States and China have also weighed on the market. Oil prices fell on Tuesday after a survey showed euro zone business expansion almost stalled in January.

US President Donald Trump last week said he would meet with Chinese President Xi Jinping, perhaps twice, in the coming weeks to try to seal a comprehensive trade deal with Beijing, but acknowledged it was not yet clear whether a deal could be reached.

Maduro, who retains control over the state, denounces Guaido as a USA puppet who is seeking to foment a coup against him.

Venezuela, like other OPEC members Iran and Libya, was exempted from making voluntary curbs under the deal on expectations that its output faced involuntary downward pressure in 2019.

Fritsch of Commerzbank said the Venezuelan issue could still drive oil higher. That's down from 10.643 million bpd in December, representing a cut that was 70,000 bpd deeper than targeted under the OPEC-led pact to balance the market and support prices.

"We've been turning the heat up on the regime", Mnuchin said Wednesday, touting the effectiveness of fresh sanctions that President Donald Trump's administration imposed January 28.

Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. This article is strictly for informational purposes only. A stronger dollar makes greenback-denominated commodities more expensive for holders of other currencies.