Oil steady ahead of producer meeting

TOKYO: Oil prices held around a one-week low on Monday ahead of a joint Opec and non-Opec meeting later in the day in the Russian city of St Petersburg to review market conditions and examine any proposals related to their pact to cut output.

London Brent crude for September delivery was up 2 cents at $48.08 a barrel by 0551 GMT. The contract settled down $1.24, or 2.5 per cent, on Friday after a consultancy forecast a rise in Opec production for July.

NYMEX crude for September delivery was unchanged at at $45.77.

Sources familiar with the talks said the meeting may recommend a conditional cap on production from Nigeria and Libya — two Opec members so far exempt from output cuts — although some analysts were deeply sceptical the group would make such a move.

“Output cuts by Libya and Nigeria would be next to impossible considering Libya was just reemerging from the civil war, for example,” said Kaname Gokon, strategist for commodities brokerage Okato Shoji in Tokyo.

Opec and some non-Opec states including Russia agreed last year to cut production by 1.8 million barrels per day (bpd) in a deal that has been extended to March 2018.

Russian Energy Minister Alexander Novak said Libya and Nigeria should cap output when their output stabilises, the Financial Times reported.

Kuwait’s oil minister, Essam al Marzouq, said on Saturday that compliance was good with oil production cuts by Opec and nonOpec countries and that deeper curbs were possible.

Meanwhile, Opec SecretaryGeneral Mohammad Barkindo said on Sunday that a rebalancing of the oil market is progressing more slowly than expected, but will speed up in the second half of 2017.