Oil edged higher on Wednesday as investors took heart from strict OPEC compliance with its pledge to cut output, although evidence of increasing U.S. production capped gains.
The Organization of the Petroleum Exporting Countries reduced its oil output for a second month in February, a Reuters survey found, showing the exporter group has boosted already strong compliance to around 94 percent.
Heftier cuts by Saudi Arabia and Angola helped offset weaker compliance by other members that agreed to limit their output.
May Brent crude futures LCOc1 rose 19 cents on the day to $56.70 a barrel at 1222 GMT, while U.S. West Texas Intermediate (WTI) futures for April delivery CLc1 rose 9 cents to $54.10.
Brent crude fell 0.2 percent in February, its largest slide in the second month of the year in four years.
Oil prices are 23 percent higher than they were at the end of November, when OPEC announced its deal, but this strength has encouraged more U.S. production to come back online.
“There seems … to be a consensus within OPEC that the optimal crude oil price is as near as possible to the upper line of our shale band price range ($40-60 a barrel) but not significantly above,” Olivier Jakob, a strategist at consultant Petromatrix, said.
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