Markets Right Now: Stocks climb as oil prices rise

He said Zanganeh had assured him Iran “would spare no effort” in helping to reach a consensus.

Adding to the positive mix are strengthening crude oil prices, the rally of late last week continuing as renewed optimism that a production cut deal can be reached by OPEC in Vienna in just 10 days is bolstered by positive rhetoric from Iran, Iraq and Russian Federation over the weekend. He described as “promising” information that was relayed to him by Barkindo about finalizing the agreement.

Given the facts above, and the “imperative” to reach agreement, I think we will see some sort of innovative, dynamic structure, as opposed to fixed quotas.

The hyperbole mounting in advance of Vienna is especially baffling considering that members such as Saudi Arabia have spent most of the year ramping up production significantly: the latest news of Saudi activity came this week, when it was disclosed that the kingdom’s crude oil exports rose to 7.812 bpd in September, an increase of 507,000 bpd versus August.

Meanwhile, Iraq’s Oil Minister Jabbar al-Luaibi said that the country, which is OPEC’s second-biggest producer after Saudi Arabia, will offer three new proposals at a meeting in Vienna this coming week to discuss implementing an OPEC accord to cut output. Opec suggested curbing output to between 32.5 million and 33 million barrels a day.

“We will have a meeting, and it’s going to be an informal and consultative meeting”, he told reporters on the sidelines of the Gas Exporting Countries Forum held in Doha.

How much each country will produce is to be decided at the next formal meeting of OPEC in November.

Without an output cut from OPEC, escalating production from exporters around the globe could lead to relentless supply growth, and the oil market surplus may run into a third year in 2017, the International Energy Agency is now emphasizing. While quotas will be decided at OPEC’s November 30 meeting, Libya, Nigeria, Iran and Iraq have said they should be exempt.

“OPEC must submit to the fact that Iraq must stay away from any possible output cut deal because the country is in the middle of a tough war and every single dollar is needed to keep it standing on its feet”, a senior government official close to Prime Minister Haider al-Abadi told Reuters. A recovery in production from both countries means the onus to cut rests on Saudi Arabia and its Gulf neighbours.

United States shares opened higher on Monday buoyed by higher oil prices on rising hopes that the OPEC cartel will sign off a supply-cutting deal later this month.

However, an Iranian oil ministry official did say, “we are nearly there”, referring to reaching the pre-sanction output mark.

Still, differences within the group remain wide, and OPEC has failed repeatedly to deliver on production cuts since oil prices began to tumble two years ago.

He also said that more non-OPEC producers could join such a pact.

The Iraq oil ministry was not immediately available for comment.