U.S. West Texas Intermediate crude rose 84 cents, or 1.8 percent, to settle at $46.58.
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“The market has certainly responded very positively to news that OPEC is gathering”, Edward Bell, a commodities analyst at Emirates NBD in Dubai, said in a Bloomberg Television interview.
It seems that Saudi Arabia is mastering the art of tipping the oil prices with a carefully uttered word, and just last week, its oil minister Khalid al-Falih proved that by saying that the Saudis would “take any action to help the market rebalance”.
Oil prices dipped in early trading on Thursday as the prospect of record Saudi output weighed on markets and as traders cashed in on profits following an almost uninterrupted price rally in August of nearly 20%.
A previous attempt to freeze output at January levels to support prices collapsed in April after Saudi Arabia said it wanted all producers, including Iran, to join the initiative. “Or is the current strength one to be sold into?”, PVM Oil Associates Tamas Varga said in a daily report.
The price of Brent crude rose almost 12% over a four-day winning streak, reaching its highest level in five weeks. In a week ending Friday, American crude oil stockpiles dropped by 2.5 million barrels, while gasoline supplies fell by 2.7 million barrels, the US Energy Information Administration reported.
Oil prices fell in Asia today as investors booked profits from recent gains, but stayed above Dollars 46 on hopes producers would decide to freeze output at a meeting next month.
Crude oil prices fell for the first time in a week as investors grow ever more sceptical about the success of potential talks among oil producers in the Organisation of Petroleum Exporting Countries (OPEC).
Saudi Arabia, now do not have any nuclear power reactors while Russia has built and has years of experiencing in constructing nuclear reactors in a statement by the Russian Energy Minister. A possible deal on capping production between members of the Opec and non-member producing countries was first flagged in February but deal discussions in April ended with no final accord.
Saudi Arabia told the Organization of Petroleum Exporting Countries last week that its production rose further in July, reaching an all-time high of 10.67 MMbpd.
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There is a good chance that OPEC will revive talks on freezing oil output levels when it meets non-OPEC nations next month. Analysts had expected a decline of 1 million barrels.
