Oil prices gain over prospects of production cuts

Brent crude futures LCOc1 fell 2 percent at one point, but regained ground to trade down 35 cents, or 0.74 percent, at $46.89 per barrel at 0749 GMT.

Crude oil prices are falling after Saudi Arabia walked away from Monday’s talks with Russian Federation and other non-OPEC producers saying there was a lack of unanimity in the cartel on how to rebalance the oversupplied oil market.

The oil companies implemented a P0.10-per-liter increase in gasoline prices on November 22, but the prices of diesel and kerosene stayed the same.

But reaching an agreement on a deal to cut output has proved problematic, with some producers reluctant to curb production. He had previously said Riyadh was keen for a deal.

The violence in Libya has significantly impacted the country’s oil production.

While making life cheaper for consumers and businesses, two years of low prices have wreaked havoc with the public finances of OPEC member states, even in the wealthy Gulf states.

In post-settlement trading, oil futures pared gains after Reuters reported that OPEC experts did not agree on the details of a deal to cut output.

Should a large output cut push through, Nordea analysts said that it could push oil prices closer to $60 per barrel before year’s end. The two have battled for power across the Middle East, as opposites in conflicts now in Yemen and Syria.

“It’s not beneficial to attend the meeting with producers from outside OPEC before holding meetings within OPEC and deciding whether to cut or continue with current levels of production”, Al-Falih said to Asharq Al-Awsat.

“I am optimistic” ahead of “this very important meeting”, he said, quoted by the Algerian news agency APS, on his arrival in Algiers where he met his counterpart Noureddine Boutarfa.

Iran, free to export oil since last year’s nuclear deal, won’t cut production until it has reached pre-sanctions levels.

“Higher oil prices means non-OPEC producers will be more encouraged to drill for more oil, which will increase global supply and prices will be depressed again”, said Gao Jian, an energy analyst at SCI International.

Back in September, OPEC announced that it has agreed on limiting oil production to address the global slumping of oil prices.

The meeting was canceled after Saudi pulled out of the talks, apparently because it wants an OPEC deal in place before engaging with non-OPEC producers.

Some market players believe the “battle of headlines” based on energy ministers’ comments are likely to fuel speculation and drive crude oil prices volatility until the meeting. “There is considerable economic pressure on Saudi Arabia for higher margins to meet its fiscal budget requirements”, Berman told Trend by email.