Oil strengthens further in thin trade

“Oil prices dropping to this level and staying here for a prolonged period of time is definitely hurting major oil producers, Russian Federation included”, Ang said in a market commentary. This convinced a few dealers that there was little chance prices would slide back to the 6-1/2-year lows touched in August.

Opec has invited non-Opec countries to attend a technical meeting in October to discuss the market, Badri told reporters, following on from a similar meeting held earlier this year.

Secretary General Salem el-Badri’s comments were made at the Oil and Money conference, a gathering of powerbrokers within the energy industry.

“We have reduced the probability of a return to the $37-38 area per nearby WTI”, said Jim Ritterbusch of oil consultancy Ritterbusch & Associates in North Wabash, Chicago. “This means less supply and higher prices in the future”.

Meanwhile, the head of Royal Dutch Shell Ben van Beurden, who was also at the London oil summit, said he saw “the first mixed signs” for a recovery in oil prices.

Iran has said it expects to boost its crude exports by one million barrels per day within six months of the lifting of sanctions. OPEC has since indicated it will only consider a cut if other big suppliers, such as Russian Federation, join it.

Nymex reformulated gasoline blendstock for November-the benchmark gasoline contract-fell 74 points to $1.4288 a gallon, while November diesel traded at $1.6186, 71 points higher.

Oil supplies from nations outside of the Organization of Petroleum Exporting Countries are set to fall by half a million barrels a day next year, Fatih Birol, executive director of the Paris-based worldwide Energy Agency, said at the London conference Tuesday.

“Crude prices are supported by a tentative uptick in risk appetite and expectations of lower U.S. production”, Bernard Aw, market strategist at IG Markets in Singapore, told Agence France-Presse.

The company also cut its prices for heavy oil by $2 a barrel to the Far East and by 30 cents a barrel to the US, according to The Wall Street Journal.

“This situation may not stay long, more than two years“, the OPEC chief said in response to a question on how long the market would take to rebalance. Higher prices will be needed to pay for this cost, so prices will increase.