US shale output set to rise even as Opec cuts supply

New York

US shale is getting in the way of a New Year's resolution by Opec to cut production and boost the market.

Producers and merchants increased their bets on lower West Texas Intermediate crude prices to the highest level since 2007 as futures held above US$50 a barrel. The increase in hedging against a price drop signals a comeback in US shale output, just as Opec members and other producers seek to reduce supply.

The Organization of Petroleum Exporting Countries reached an agreement in November to cut production by 1.2 million barrels a day for six months starting in January, and were joined by 11 non-Opec nations in an effort to reduce a global glut. The Energy Information Administration last week raised its forecast for 2017 US crude production. A Barclays Plc survey sho…