(Bloomberg). Oil gained in Asian trading following OPEC’s and its allies agreeing to a planned increase in production next month and an industry report pointing to another drop in inventories.

After rising 2.4% in the last two sessions, futures traded at $77 per barrel in New York after they rose to above that level. After reducing estimates that there would be a surplus during the first quarter of 2018, the OPEC+ group maintained its plans to boost output by 400,000 barrels each day for February. According to sources familiar with the data, American Petroleum Institute said that U.S. stocks fell by 6.43 Million barrels last week.

As concerns over the impact of the Omicron virus variant on oil demand eased, and the major economies are continuing to recover from the pandemic, oil has had a good start to this year. The actual OPEC+ supply surge could actually be lower than agreed, as members like Nigeria and Angola struggle to meet their production targets.

“The move has provided some comfort to the market, as it signals that OPEC+ are not worried about the outlook in the short term,” said Warren Patterson, head of commodities strategy at ING Groep (AS:) NV in Singapore.

According to the API, gasoline inventories in America increased by 7.06 Million barrels. However, distillates inventories, which includes diesel, rose by 4.38 Million barrels. On Wednesday, official government data will be available.

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