Oil holds gains as producers say market rebalancing

oil2 (1)

TOKYO: Oil prices stood little changed on Monday, keeping most of their gains from the previous session to hold near their highest levels in months, as major producers meeting in Vienna said the market was well on its way toward rebalancing.

The Organization of the Petroleum Exporting Countries, Russia and several other producers have cut production by about 1.8 million barrels per day since the start of 2017, helping lift oil prices by about 15 percent in the past three months.

“Since our last meeting in July, the oil market has markedly improved,” said Kuwaiti Oil Minister Essam al-Marzouq, who chaired Friday’s meeting, of the Joint Ministerial Monitoring Committee.

London Brent crude for November delivery was up 1 cent at $56.87 a barrel by 0049 GMT, having settled up 0.8 percent on Friday. U.S. crude for November delivery was down 4 cents at $50.62, having risen 0.2 percent on Friday.

Russia’s energy minister said no decision on extending output curbs beyond the end of March was expected before January, although other ministers suggested such a decision could be taken before the end of this year.

Markets were also nervously eyeing developments in North Korea. North Korea’s Foreign Minister told the United Nations on Saturday that U.S. President Donald Trump had made “our rockets’ visit to the entire U.S. mainland inevitable” by calling North Korean leader Kim Jong Un “rocket man”.

U.S. energy firms cut the number of oil rigs operating for a third week in a row as a 14-month drilling recovery stalled as companies pared back on spending plans when crude prices were softer.

Hedge funds boosted bullish wagers on U.S. crude oil to the highest level in one month, data showed on Friday, as prices hit a five-month peak on expectations that a persistent glut would fade and the dollar weakened.