Oil traded near $50 a barrel with OPEC’s Secretary-General set to visit Baghdad on Tuesday for talks aimed at resolving a deal on output after Iraq said it should be exempt from planned cuts.
Futures were little changed in New York after falling 0.7 percent Monday. Mohammed Barkindo will meet with the prime minister and oil minister, according to people familiar with the matter, after Iraq said Sunday it should be excluded due to conflictwith Islamic militants. U.S. crude stockpiles rose last week, a Bloomberg survey shows before government data Wednesday.
Oil has fluctuated near $50 a barrel amid uncertainty about whether the Organization of Petroleum Exporting Countries can implement an accord to reduce oil output when they gather at an official meeting in November. A committee will meet later this month to try to resolve differences over how much individual members should pump.
“Oil is in a holding pattern, waiting to see the outcome of the November meeting,” said David Lennox, a resources analyst at Fat Prophets in Sydney. “If OPEC doesn’t implement the production cuts, the oil price will probably retreat back toward the $45 a barrel level.”
West Texas Intermediate for December delivery was at $50.53 a barrel on the New York Mercantile Exchange, up 1 cent, at 8:01 a.m. in London. Prices slid 33 cents to close at $50.52 on Monday. Total volume traded was about 38 percent below the 100-day average.
Brent for December settlement was 8 cents lower at $51.38 a barrel on the London-based ICE Futures Europe exchange. The contract dropped 32 cents, or 0.6 percent, to $51.46 on Monday. The global benchmark crude was at a premium of 85 cents to WTI.
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Russia is making progress toward an output agreement with OPEC, Russian Energy Minister Alexander Novak said Monday after talks with officials from the group in Vienna. The discussions addressed “concrete” production levels, he said, declining to elaborate.
- U.S. crude stockpiles probably increased by 1.25 million barrels last week, according to the median estimate in a Bloomberg survey before an Energy Information Administration report.
- A key pipeline capable of carrying 400,000 barrels a day of crude to the Texas Gulf Coast from the largest U.S. storage hub at Cushing, Oklahoma, was shut after a spill late Sunday.