Oil prices gain amid Saudi output cut, U.S. inventory draw

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NEW YORK, Jan. 7 (Xinhua) -- Oil prices climbed on Thursday as Saudi Arabia's surprisingly strong voluntary production cut and a pronounced inventory reduction in the United States continued to lend a support.

The West Texas Intermediate for February delivery added 20 cents to settle at 50.83 dollars a barrel on the New York Mercantile Exchange. Brent crude for March delivery increased 8 cents to close at 54.38 dollars a barrel on the London ICE Futures Exchange.

Saudi Arabia's big voluntary output cut was still lending tailwind, "because the oil market could tighten as a result in the first quarter, despite weaker demand due to tougher mobility restrictions in many consumer countries," Carsten Fritsch, energy analyst at Commerzbank Research said in a note on Thursday.

Saudi Arabia, the world's biggest oil exporter, on Tuesday pledged a voluntary oil production cut of 1 million barrels per day beyond the required OPEC+ quotas in February and March.

U.S. crude oil inventories decreased by 8.0 million barrels during the week ending Jan. 1, the U.S. Energy Information Administration (EIA) said in a report on Wednesday. Analysts polled by the Reuters had expected the EIA publication to show a 2.1 million-barrel drop in U.S. supplies last week. Enditem

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