Oil prices extend rebound in Asia

But analysts said the prospect of a production cut remained distant, as it was weaker Opec members such as Venezuela, rather than Riyadh, that were pushing for an emergency meeting as soon as this month.

On the other hand, rising production from Iran and rising global inventories will likely negatively affect crude oil prices.

“Unless something changes, the oil market could drown in oversupply”, the International Energy Agency warned in its January report, estimating an oversupply of 1.5 million barrels per day in the first half of 2016 if Iran adds 600,000 barrels per day by mid-year.

“Headlines continue to fly about an Opec/non-Opec meeting”.

National Australia Bank (NAB) said on Thursday that it expected “oil prices to recover mildly to $40 per barrel by end-2016 and $50 per barrel by end-17”.

US gasoline inventories rose to a record high, soaring 5.9 million barrels to 254.4 million barrels.

Crude also gained as Venezuela’s oil minister, on a tour to lobby for steps to boost prices, appeared to be gaining support from more members of the Organization of the Petroleum Exporting Countries and outside producers for a meeting. “Without Saudi Arabia it would not make sense anyway”.

Weaker demand is only adding fuel to the proverbial fire, with the current Opec oil production at 32.60 million barrels per day (bpd), its highest in years. “If the wealthier Gulf producers are tolerating lower prices to protect market share, there are already plenty of signs that this policy is working”. Similarly, BP plc (NYSE:BP) announced that it would cut around 4,000 jobs, highlighting the pressure of declining oil prices on oil majors.

Moreover, just hours after Mr. Novak’s statements and rumors that Saudi Arabia had proposed a 5% cut in OPEC production rates, OPEC senior delegates were reported to have negated the rumors.

Oil futures were bouncing back on Wednesday afternoon after Russia´s foreign minister reiterated his country was open to negotiations aimed at stabilising oil prices.

US crude inventories climbed 7.8 million barrels in the week to January 29 to 502.7 million barrels, compared with analyst expectations for an increase of 4.8 million barrels.

Similarly, the drastic decline in WTI crude oil prices over the past one year also showed that oil market is in “enormous strain”.

Crude oil futures were steady in lacklustre trading on Friday as Asian liquidity faded ahead of the Lunar New Year holiday across large parts of the region.

OPEC’s recent Monthly Oil Market Report suggests that the Chinese economy grew by an estimated 6.8% during 2015.