Oil Update: Prices hold as global crude inventories touch their five-year average

Oil came under pressure from Dollar, however, sustained most of its gains as the meeting in Vienna released the statement saying the markets are well on their way to rebalancing.

London Brent crude for November delivery was down 4 cents at $56.82 a barrel by 0614 GMT, near the highest since March. U.S. crude for November delivery was down 10 cents at $50.56, but not far off recent four-month highs.

The dollar index was up 0.1 percent against a basket of currencies.

The Organization of Oil Producing Countries, as well Russia were all part of a meeting held in Vienna on Friday to discuss the impact of output cuts. Prices for oil have went up by 15 percent in the last three months since output was slashed by the OPEC members and non-members.

The Kuwaiti Oil Minister, part of the meeting, announced that the oil inventories have averaged out to their five year levels, OPEC’s set targets for the cuts.

The Russian Minster for Oil, holding a presser after the meeting, said that no agreement was reached to extend the cuts beyond March in the meeting. However, the cartel hinted that the decision on cuts could be taken well before the end of this year.

The UAE Minister informed the members that, compliance with cuts have been 100 percent from the UAE side, while Libya has brought down production from 1 million bpd to 900,000 bpd. According to industry experts oil is relatively underpriced against other markets, whereas any effect from shrinkage in inventories would be negated by higher drilling from US Shale rigs.