US oil prices climbed back above US$30 a barrel on Monday amid signs of a potential deal by the world’s biggest oil producers to tackle a supply glut.
Crude rose US$1.17, or 4 percent, to US$30.61 per barrel as the US market reopened after a shortened holiday session, building on Friday’s more than 12 percent surge.
Brent futures for April delivery were up 65 US cents, or 2 percent, to US$34.01.
The world’s top two oil exporters, Saudi Arabia and Russia, will hold talks with their counterparts from Venezuela and Qatar in Doha on Tuesday, Reuters reports, citing unnamed sources.
Bloomberg is reporting that Saudi Arabia’s oil minister plans to meet with his Russian counterpart in Doha on Tuesday to discuss the oil market.
Ali al-Naimi, the most senior oil official of the world’s biggest crude exporter, will speak with Russia’s Alexander Novak in the Qatari capital.
Saudi Arabia has insisted that it won’t reduce production to tackle the global oil glut unless major producers outside the Organization of Petroleum Exporting Countries co-operate.
While Novak has said he could consider output cuts if other producers joined in, Igor Sechin, chief executive officer of the country’s largest oil company Rosneft OJSC, said last week he would defend traditional markets and expressed doubts over coordinated action.
Still, oil’s deepening slide this year to below U$30 a barrel has put increased financial strain on oil-dependent economies and there has been growing speculation that there may be an opportunity to discuss a deal between the world’s two largest exporters.
“The back channel talks, which Qatar is brokering, had been in place for a while,” said Amrita Sen, chief oil analyst at Energy Aspects Ltd. in London.
“These are still very early days and nothing concrete has been agreed, but there is a growing sense that countries could be more flexible, although Riyadh would insist that everyone else contribute to the cut.”
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