(Fixes WTI price in paragraph five)
* OPEC/Russia-led supply restraint has propped up crude
* Goldman Sachs sees upside to its oil price forecast
* Morgan Stanley, BoAML raise crude price forecasts
* U.S. oil production has stalled due to icy weather
* But U.S. output expected to break through 10 mln bpd soon
By Julia Payne
LONDON, Jan 16 (Reuters) - Brent crude oil shed some of its
recent gains by falling just over $1 a barrel on Tuesday but
healthy demand underpinned prices near $70, a level not seen
since 2014's market slump.
Prices have been driven up by oil production curbs in OPEC
nations and Russia, as well as strong demand thanks to healthy
Brent futures fell by $1.08, or 1.54 percent, to
$69.18 per barrel by 1108 GMT. Traders said Brent was well
supported overall at around $70.
Brent hit $70.37 on Monday, a high from December 2014, when
markets were at the beginning of a three-year decline.
U.S. West Texas Intermediate (WTI) crude futures were
at $63.87 a barrel, down 43 cents, or 0.67 percent. WTI hit a
December 2014 peak of $64.89 in early trading.
"The market is hitting technical resistance. We need to see
a confirmation of a true break past $70 a barrel," Olivier Jakob
of Petromatrix consultancy said.
"There is lots of speculative length in WTI at the moment
... the force is from the U.S. market right now so we need the
direction they give coming back from holiday."
Trading was thin on Monday due to a holiday in the United
Oil has been pushed higher by an effort led by the
Organization of the Petroleum Exporting Countries and Russia to
withhold production since January last year. The cuts are set to
last through 2018.
Reacting to the recent three-year high, Russian Energy
Minister Alexander Novak said the oil market was not yet
balanced and that the global deal to cut output should continue
as the price rise could be due to cold weather.
Novak maintained his $50-$60 a barrel forecast for 2018.
The restraint has coincided with healthy oil demand, pushing
up crude by almost 15 percent since early December.
"This rally has been driven first by robust fundamentals,
with strong demand growth and high OPEC compliance
accelerating," U.S. bank Goldman Sachs said in a note.
"We see increasing upside risks to our $62 per barrel Brent
and $57.5 per barrel WTI forecast for the coming months."
Other U.S. banks, including Bank of America Merrill Lynch
and Morgan Stanley, have upped their price forecasts.
A factor holding back crude prices in 2017, the surge in
U.S. production, has stalled at least temporarily due to icy
U.S. production <C-OUT-T-EIA> has fallen from 9.8 million
barrels per day in December to 9.5 million bpd currently.
However, most analysts still expect U.S. production to break
through 10 million bpd soon.
(Additional reporting by Henning Gloystein; Editing by Dale
First Published: 2018-01-16 04:15:19
Updated 2018-01-16 13:36:01
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