Brent traded near $33/bbl as Russia said talks on an output freeze will be done by March 1 while Nigeria said some countries should have production capped at higher levels.
Futures rose as much as 0.8% in London, paring Friday’s 3.7% drop. Iran was “constructive” on the deal struck last week to cap output, although it hasn’t said whether it may join the pact, Russian Energy Minister Alexander Novak told state TV on Saturday. While Nigeria backs the plan, Iraq and Iran should recover lost market share, Minister of State for Petroleum Resources Emmanuel Kachikwu said Sunday.
Crude is down about 11% this year on speculation a worldwide surplus will persist amid the outlook for increased exports from Iran after the removal of international sanctions and brimming U.S. stockpiles. Saudi Arabia, Russia, Venezuela and Qatar reached a preliminary agreement in Doha last week to freeze output at January levels if other states join them.
“Even if the proposal is agreed, it’s unlikely to have much difference to the balance of the oil market in the near term,” Ric Spooner, a chief analyst at CMC Markets in Sydney, said by phone. “Prices also face the relentless weight of growing inventories, which are getting larger.”
Brent for April settlement rose as much as 26 cents to $33.27/bbl on the London-based ICE Futures Europe exchange and was at $33.25 at 9:33 a.m. Hong Kong time. Prices slid 1.1% last week for a third weekly decline. The European benchmark crude was at a premium of $1.16 to West Texas Intermediate for April.
WTI for March delivery, which expires Monday, was 24 cents higher at $29.88/bbl on the New York Mercantile Exchange. Prices rose 0.7% last week. Total volume traded was about at about the 100-day average. The more-active April future was up 34 cents at $32.09/bbl.