Oil holds near 2-year high as Saudi prince backs Opec cuts
hong kong — Brent oil held gains near the highest level in more than two years as Saudi Arabia’s Crown Prince Mohammed bin Salman backed the extension of Opec-led output cuts.
Futures were little changed near $60 a barrel in London, up 2.6 per cent for the week. The prince said on Thursday that “of course” he wanted to prolong the curbs beyond the end of March 2018. Opec is considering an exit strategy to avoid flooding the market once the agreement finally expires, people familiar with the talks said this week. Total’s chief executive officer Patrick Pouyanne said the imbalance between crude supply and demand is finally dissipating.
Brent has gained as speculation mounts the Organisation of Petroleum Exporting Countries will agree at its November 30 meeting to extend cuts by its members and allied nations aimed at draining a global glut. Oil ministers from Saudi Arabia and Russia will meet on November 2 to discuss prolonging the deal, Russian Energy Minister Alexander Novak said on Tuesday. Stronger demand will help cut stockpiles this year for the first time since prices slumped in 2014, the International Energy Agency said earlier this month.
Brent for December settlement was at $59.26 a barrel on the London-based ICE Futures Europe exchange as of 10.20am in London. Prices rose 1.5 per cent to $59.30 on Thursday, the highest close since July 2015. The global benchmark traded at a premium of $6.69 to West Texas Intermediate. WTI for December delivery lost 2 cents to $52.62 a barrel on the New York Mercantile Exchange. Total volume traded was about 46 per cent below the 100-day average. The contract gained 46 cents to close at $52.64 on Thursday, the highest since April. Prices are up 2.2 per cent this week. — Bloomberg