On the New York Mercantile Exchange, West Texas Intermediate futures were trading up 2% at $44.91 a barrel.
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SINGAPORE (Reuters) – Oil prices rose nearly 2 percent on Monday, after Venezuela said OPEC and non-OPEC producers were close to reaching an output stabilizing deal and as clashes in Libya raised concerns that efforts to restart crude exports could be disrupted.
The leak in Colonial Pipeline Co.’s Line 1 in the US has also been fixed and the infrastructure should start to ramp up to full capacity in the coming days.
The fighting led a Maltese-flagged tanker to turn back out to sea for safety, abandoning plans to load crude oil at Ras Lanuf.
Supply needs to be cut by 1 million barrels a day to rebalance the market and stabilise prices, he said.
Meanwhile, Russia’s permanent representative to the Organization of the Petroleum Exporting Countries, Vladimir Voronkov said Russia would back a deal to stabilize oil markets for a year, according to Moscow-based news agency Interfax.
Pickens, who chairs investment firm BP Capital Management, stated he does not see crude rising to $100 a barrel, however, because of the size of USA reserves.
Nearly two years after the Organization of Petroleum Exporting Countries set a strategy to eliminate the global oil glut by pressuring rivals with lower prices, markets continue to struggle with excess supply and crude remains capped below US$50 a barrel. The contract fell 88 cents to settle at $43.03/bbl on Friday, the lowest close since August 10.
The American Petroleum Institute (API), a trade group, said US crude inventories fell by 7.5 million barrels for the week ended September 16, drawing unexpectedly for a third week in a row.
The latest Energy Information Administration (EIA) data will be watched very closely on Wednesday following the API data.
During a visit to Algiers at the weekend, OPEC Secretary General Mohammed Barkindo said an extraordinary meeting could happen if there is consensus.
Oil prices have swung for weeks now as traders weighed an oversupplied market against OPEC hints of production curbs.
Brent futures closed down US7 cents at $US45.88 per barrel.
Oil prices were also dragged down by statements from Venezuelan Oil Minister Eulogio Del Pino who said that oil markets were oversupplied by about 10 per cent.
Japan’s Ministry of Finance said that last month that crude imports in the country increased 0.5% from the same month previous year and reached 3.38 million barrels a day.
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“A production freeze is what we all want, but I´m not sure if we will finalize all the discussions at this meeting”, this source said.
