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Oil holds gains near US$53 as Kuwait sees price rise continuing

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Oil held near US$53 a barrel in New York as Kuwait's oil minister predicted a price rebound will continue amid a shrinking surplus.

[NEW YORK] Oil held near US$53 a barrel in New York as Kuwait's oil minister predicted a price rebound will continue amid a shrinking surplus.

Futures were little changed after rising 3.1 per cent on Feb 13. Floor trading was closed on Monday for a holiday. Prices have recovered faster than expected and will continue to improve, according to Ali Al-Omair, the oil minister for the third-biggest producer in the Organization of Petroleum Exporting Countries. The market is shifting its focus to tightening supply, Standard Chartered Plc said in a report.

Oil is rebounding from the lowest prices in almost six years as US drillers cut the number of rigs in service to the fewest since August 2011. The decline is still not enough to halt production growth, according to Goldman Sachs Group Inc. The nation's rising output contributed to an almost 50 per cent slump in crude in 2014.

West Texas Intermediate for March delivery was 2 cents below Friday's close at US$52.76 a barrel in electronic trading on the New York Mercantile Exchange at 10.06 am Sydney time. The contract climbed US$1.57 to $52.78 on Feb 13. Volume of all futures traded was about 52 per cent below the 100-day average. Monday's transactions will be booked with Tuesday's for settlement purposes as floor trading was closed for the Presidents' Day holiday in the US.

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Brent for April settlement slid 12 cents, or 0.2 per cent, to US$61.40 a barrel on the London-based ICE Futures Europe exchange on Monday. The European benchmark crude ended the session at a premium of US$7.85 to WTI on Feb 13.

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