Oil prices rose more than by $ 1 a barrel on Tuesday after OPEC said it adheres to the terms of the decrease in production volumes.
General Secretary of the cartel, Mohammed Barkindo, noted that countries adhere to agreed quotas by more than 90%.
Brent rose by $ 1.13 to $ 57.31 a barrel before it weakened to $ 57.15.
WTI increased by $ 1.00 to $ 54.40, gaining 0.6% on Monday.
OPEC and countries outside the cartel agreed to reduce oil production by 1.8 million barrels a day, in order to accelerate the rebalancing of the market.
Fund managers hold the largest amount of net long positions in Brent in history, betting on rising prices.
Net long positions on WTI futures and options are, as well, reaching the record.
These speculative positions are a cause for concern, warns Jonathan Chan, an investment analyst at Phillip Futures.
When these positions begin to close, prices face significant correction.
Despite signals that OPEC follows the agreements, inventory levels in many countries remain high.
Last week, US gasoline and crude oil inventories rose to record highs as demand for gasoline and processing activity went on the decline, said the Energy Information Administration.
“On Thursday, the US Energy Department will submit a report on reserves, which can be a catalyst for the market, while the long absence of negative factors will push the prices up”, – said Carsten Fritsch, an analyst at Commerzbank.
Rates support oil prices
For the first time in history, hedge funds bet on more than a billion barrels of oil price increases. Fund managers last week increased their long positions in Brent and West Texas Intermediate to a record size.
Speculators took a wait, futures in New York are held in the narrowest range for 13 years, and the internal volatility in Brent reaches a minimum for more than two years, Bloomberg reports.