OIL PRICES: EVEN ABOVE $47
REUTERS wrote, oil prices rose on Thursday as expectations of an OPEC deal to limit production outweighed growing evidence of global oversupply and rising inventories, particularly in the United States.
Saudi Energy Minister Khalid al-Falih said on Thursday he was optimistic OPEC would formalize a preliminary oil output deal reached in Algeria in September.
"I'm still optimistic that the consensus reached in Algeria for capping production will translate, God willing, into caps on states' levels and fair and balanced cuts among countries," he told Saudi-owned Al-Arabiya TV.
Falih said he believed the market was on its way to becoming balanced and that an agreement by the Organization of the Petroleum Exporting Countries at its meeting in Vienna on Nov. 30 would speed the recovery.
Brent crude oil LCOc1 was up 60 cents a barrel at $47.23 by 1120 GMT (6:20 a.m. ET). U.S. light crude CLc1 was up 50 cents at $46.07.
U.S. crude inventories rose by 5.3 million barrels in the week to Nov. 11, well above forecasts of an increase of 1.5 million barrels, data from the U.S. Energy Information Administration showed on Wednesday. [EIA/S]
Stocks are also rising elsewhere, thanks to record output by OPEC, which pumps around 40 percent of world oil supply.
"The name of the game is 'volatility' as confusing signals are arriving before OPEC meets," said Tamas Varga, senior analyst at London brokerage PVM Oil Associates.
"We have evidence of oversupply - U.S. stocks rising - versus hopes for some action by OPEC."
Venezuelan President Nicolas Maduro said on Wednesday OPEC countries are ready to reach a "forceful" agreement on cutting oil output. Maduro met OPEC Secretary-General Mohammed Barkindo in Caracas to discuss a possible OPEC deal.
Russia has also expressed willingness to support an OPEC decision to freeze output, Russian Energy Minister Alexander Novak said.
But rising oil production and changing fundamentals "make a credible OPEC cut all the more difficult to achieve", Jason Gammel, analyst at U.S. investment bank Jefferies, said.
"The physical market has shifted back to oversupply because of surging OPEC output, with the most material increases driven by improving security conditions in Libya and (tenuously) Nigeria," he said.
Jefferies expects Brent to average $58 a barrel next year.
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BP and its partners in Azerbaijan's giant ACG oil production complex agreed Thursday to extend the production sharing contract by 25 years to 2049 and to increase the stake of state-owned SOCAR, reducing the size of their own shares.
The U.S. current-account deficit increased to $123.1 billion (preliminary) in the second quarter of 2017 from $113.5 billion (revised) in the first quarter of 2017, according to statistics released by the Bureau of Economic Analysis (BEA). The deficit increased to 2.6 percent of current-dollar gross domestic product (GDP) from 2.4 percent in the first quarter.
U.S. West Texas Intermediate (WTI) crude futures CLc1 were trading up 41 cents, or 0.8 percent, at $50.30 by 0852 GMT, near the three-month high of $50.50 it reached last Thursday. Brent crude futures LCOc1, the benchmark for oil prices outside the United States, were at $55.91 a barrel, up 29 cents, and also not far from the near five-month high of $55.99 touched on Thursday.
“The principal risk regarding Russian and Chinese activities in Venezuela in the near term is that they will exploit the unfolding crisis, including the effect of US sanctions, to deepen their control over Venezuela’s resources, and their [financial] leverage over the country as an anti-US political and military partner,” observed R. Evan Ellis, a senior associate in the Center for Strategic and International Studies’ Americas Program.