The Organization of the Petroleum Exporting Countries (Opec) is finally making some headway in its race against the tide of surging US supplies, and speculators are giving the group greater credence.

Hedge funds boosted bets on higher West Texas Intermediate (WTI) crude oil prices for a second week as futures topped $53 a barrel for the first time in a month, US Commodity Futures Trading Commission data shows.

While more Opec members are seen ready to extend output cuts, US crude oil stockpiles fell from a record.

Fuel supplies are shrinking week after week at a time refineries are stepping up their crude oil processing ahead of the summer driving season.

Success of FRBM targets hinges on states

The report of the Fiscal Responsibility and Budget Management (FRBM) Review Committee has made a plethora of suggestions, which if implemented in entirety would go a long way to ensure low and stable interest rates.

However, the fiscal targets set by the review committee will need an overhaul of the fiscal positions of states for them to be met, note analysts of Kotak Securities Ltd.

The report does not explicitly give deficit targets for state governments.

However, it notes that if state governments’ debt as a percentage of GDP is to be maintained at current levels of 21%, aggregate states’ gross fiscal deficit as a percentage of GDP would have to reduce to 1.7% by fiscal year 2025.

Given the recent performance of the states, it is difficult to expect this pace of consolidation, the note said.

“We believe that the report’s recommendation of setting up a Fiscal Council which will monitor the government’s fiscal health is crucial for long term setting of fiscal rules," added the Kotak note.

Services trade balance swings into surplus

Encouragingly, the services trade surplus rose by 13% on a year-on-year basis in February 2017, after recording a sustained contraction since May 2016.

Growth of services exports and imports has displayed a mixed trend over the last fiscal year, offering no clear indication as to the outlook for the services surplus.

“The services exports recorded a modest 5.9% growth in February 2017, which is partly on account of a favourable base effect. It is too early to conclude whether this trend of a higher service trade surplus will continue," said Aditi Nayar of rating agency Icra Ltd.