Oil up 10 % on potential producer action to prop up market
SINGAPORE : Oil prices edged have risen more than 10 percent on Monday since the start of the month as speculation intensifies about potential producer action to support prices in an oversupplied market.
International Brent crude oil futures were trading at $47.13 per barrel up 16 percents from their last settlement, and over 10 percent above the last close in July. U.S. West Texas Intermediate (WTI) crude futures were at $44.67 a barrel, up 18 cents from their last close.
Oil posted another gain as speculation of potential production freezes by OPEC picked up pace. Saudi Arabia signaled that it is prepared to discuss stabilizing the markets at informal OPEC discussions next month, ANZ bank said on Monday.
This is despite another strong rise in drilling activity in the U.S. Baker Hughes data showed the number of rigs operating in the U.S. rose by 15 last week to 396, it added.
After falling sharply from over 1,600 in 2014, the U.S. oil rig count has steadily risen since then as U.S. producers have adjusted to lower prices.
Meanwhile, an aggressive fight by producers for Asian market share is ongoing. Iran’s crude exports to South Korea rose in July to nearly four times the level of a year ago and 5.9 percent higher than the previous month, after international sanctions were lifted on Tehran’s disputed nuclear program.
South Korea imported 1.10 million tonnes of Iranian crude oil last month (260,910 barrels per day, compared with just 286,374 tonnes imported a year earlier when sanctions were still imposed on Tehran, customs office data showed on Monday.
Source : Reuters