Saudi Arabian Energy Minister Khalid Al-Falih said that the market is moving in the right direction, stressing that there were no specific discussions in OPEC on the issue of oil freeze.
Advertisement
“Capping production at this level would hardly reduce supply in any case, especially since other leading OPEC producers such as Iraq are producing at or near record levels”, the bank’s commodity team said in a note.
OPEC is scheduled to meet in Algeria from September 26-28, and speculation is rife that the oil cartel, along with the non-OPEC producers like Russian Federation, will join hands and agree to cap oil production, in order to provide stability to the oil markets. “I certainly don t advocate a cut”, he told Bloomberg News.
Brent crude futures rose 66 cents to $50.33 a barrel by 2.36pm GMT.
Oil prices rose more than 20% in the first three weeks of August on talk of a potential deal by oil exporters to freeze production levels to try support prices. Jamie Webster, a fellow at the Columbia Center of Global Energy Policy, expressed skepticism over the latest narrative on market stabilization efforts.
Zanganeh had given a brief boost to world prices on Thursday after announcing he would attend the informal Opec meeting in Algiers on a possible output freeze with non-cartel producer Russian Federation in late September.
An attempt to jointly freeze production levels earlier this year failed after Saudi Arabia backed out over Iran’s refusal to take part of the initiative, underscoring the difficulty for political rivals to forge consensus.
“Brent oil is expected to approach a support at $48.52 per barrel again, as its correction from the August 19 high of $51.22 has not completed”, he said. The country’s output was set at 3.6 million bpd in July, OPEC figures show. “There is the freeze that is official, and there is the freeze that is practical”, Al-Falih said.
“Iraq is seeking to play an active role in order to support oil prices while preserving a share that is proportionate to its reserves”, the minister said during a visit to the southern oil city of Basra, according to oil ministry spokesman Asim Jihad.
Oil minister also said on Thursday that OPEC Secretary General Mohammed Barkindo will visit Tehran “in the near future”.
Advertisement
Gasoline futures were the only bright spot in the oil complex on Wednesday, trading higher after a spate of refinery outages and on concerns about a possible hurricane headed towards the US Gulf Coast where many oil and gas installations are located.
