Prices hold as oil rally turns bearish amid rising US output

Oil prices held their own on Thursday after falling late in the day supported by ongoing supply cuts led by Russia and OPEC. However, traders have turned their stance on the future oil prices bullish as industry demand continues to falter.

On another note, one of the leading financial groups in the world has hinted the traders banking on extension cuts from OPEC might be disappointed. The CITI group has hinted that bloc’s November 30th meeting in Vienna may not deliver its public promises of extension in cuts.

Brent futures were at $63.66 per barrel at 0155 GMT, up 17 cents, or 0.3 percent, from their last close, but about $1 off the more than two-year high of $64.65 a barrel reached earlier this week.

U.S. West Texas Intermediate (WTI) crude was at $56.92 per barrel, up 11 cents, or 0.2 percent, but also some way off this week's more than two-year high of $57.69 a barrel.

According to the Citi group, OPEC’s oil strategy has so far paid off. Over one-half of the surplus that caused the initial price crash has disappeared since the beginning of the year. Oil prices are in the $60 range, which is the highest point in over two years.

However, in the US Shale industry, output has reached record highs as drillers increase their positions to cash in on the rising oil prices.