"Crude prices are tumbling despite the biggest weekly drawdown in USA inventories since September 2016", said Joshua Mahony, market analyst at IG.
Global oil prices rose by 1.3-1.5 percent on Wednesday, adding to the gains posted earlier this week as the lower production outlook in the U.S. coincided with lower Saudi exports expectations and higher demand for fuel in North America.
"We sat with them and we had a very productive and very useful preliminary meeting with them", he said.
At various points over the past year, hopes have risen that production cuts by OPEC might succeed in draining the world's oil inventories enough to bring prices somewhere into the $55 per barrel range needed for USA producers to really get moving again.
Currently, compliance with the production cuts is an impressive 93%, but if producers begin to question whether the pact is worth maintaining, that figure could drop fast, pushing prices down even more. The commodity is looking to be extending the positive gains until the end of the week because of the growing cut in the fuel inventories and the USA government's adjusted forecasts for crude output for next year.
OPEC's share of world oil demand has climbed from just 1.8 percent in 1973 and 4.1 percent in 1980 to peak at 9.9 percent in 2015 before edging down to 9.5 percent in 2016.
OPEC needs to "sudden stunning exhibition" the oil advertise with more profound slices at costs to pick up, Goldman Sachs Group Inc. said in a July 10 report. "With negotiation going on right now, we are hopeful that the price stability we are seeking will happen later this month or early August".
Still, OPEC's two largest producers, Saudi Arabia and Iraq, as well as Angola, have also increased output. US production rose 0.6% in the past week to 9.4 million barrels a day.
In its monthly oil market report for July 2017, OPEC said Nigeria's oil output hit an average of 1.733 million barrels per day, according to secondary sources. U.S. West Texas Intermediate crude CLc1 rose $1.31, or 2.9 percent, to settle at $45.71 per barrel.
Three consecutive selloffs, coming as the Opec expectations premium deflated, have resulted in potential buyers stepping aside - thereby leaving short-sellers back in control. In its most recent report, OPEC revealed that Saudi Arabia action increased production in June. That agreement, which became official at the start of 2017 and runs until March 2018, is perhaps the only thing keeping oil prices from further collapsing.
OPEC and top non-members will meet in Russian Federation on July 24 to discuss the effectiveness of the deal, as oil prices remain below the key $50 line.
"For 2018, OPEC sees non-OPEC oil supply growing by 1.1mbbls/day, higher than the 800,000bbls/day growth expected for 2017, to average 58.96mbbls/day", PublicInvest said.
OPEC's oil exports declined in June by 250,000 barrels per day.