Oil dips on doubts over touted production cuts

By Henning Gloystein | SINGAPORE Oil prices dipped on Thursday, hit by doubts that producers would fully deliver on promises to cut output, although record U.S. automobile sales and falling crude stocks offered markets some support. Brent crude futures, the international benchmark for oil prices, were trading at $56.29 per barrel by 0559 GMT, down 17 cents from their last close. Traders said the decline came on the back of worries whether plans by the Organization of the Petroleum Exporting Countries (OPEC) and other leading producers to cut crude supply would be fully implemented. “There remains a question mark over whether OPEC, with a long history of non-compliance, will actually follow through (with the cuts). Very few respondents expect full compliance,” Singapore Exchange (SGX) said on Thursday, citing results from a survey of its participants. “Three-quarters of those surveyed went for (crude) prices averaging within the current $50-60/barrel range (for 2017),” SGX added. In a note to clients on Wednesday Goldman Sachs said “the oil market outlook in early 2017 will be driven largely by the OPEC and non-OPEC cuts” and it expected “Brent prices to peak at $59 per barrel” by mid-2017. However, technical price trend indicators show Brent

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