Oil prices edge back above the $50 per barrel mark

The USA benchmark, West Texas Intermediate crude, was 16 cents lower at $46.10 a barrel.

Iran’s crude oil sales were on track to slip to the lowest in seven months as its main Asian customers were buying less than before.

Brent, the global benchmark for crude, rose US$2.67 to settle at $51.92 a barrel.

Analysts stressed that Middle East OPEC members appear better placed to manage the impact of lower oil prices versus their African and Latin American counterparts, where fiscal balances have deteriorated.

Oil prices have nearly halved in the a year ago on oversupply in a drop that deepened after OPEC in 2014 changed strategy to protect market share against higher-cost producers, rather than cut output to prop up prices as it had done in the past.

Another supportive factor is the weakening greenback, which drives demand by making oil cheaper for buyers who are using other currencies.

He believes Saudi Arabia, which is the largest oil producer and exported within OPEC, is now trying to eliminate unconventional oil production seen in hydraulic fracturing through overproduction. Russian Oil Minister Alexander Novak said that he is ready to meet OPEC and non-OPEC oil producers to discuss the oil market if such a meeting is called.

US Energy Information Administration estimated in its short-term Energy Outlook on Tuesday that total United States crude oil production declined by 120,000 barrels per day in September compared with August, Xinhua reported.

The secretary-general expressed concern about the impact of low oil prices on investment and the consequences for future supply when he spoke on the issue on Tuesday, October 6, in London.

“We are about to see a pretty dramatic decline in USA production growth”, the former head of oil firm EOG Resources Mark Papa, told the conference.

“Fuel products are leading the way today though they also seem to be deriving their strength from the broader risk appetite contributed by the equities rally”, said Pete Donovan, broker at Liquidity Energy in New York. One swallow does not a summer make but I am beginning to sense a more positive mood in the oil market although make no mistake in the short term fundamentals remain poor.

Russian Federation wants higher prices through constricted production. Daniel Ang, an investment analyst with Phillip Futures in Singapore, said the return of Iranian oil after it complies with an agreement on curbing its nuclear programme, is likely to be part of any talks.