OIL PRICES: OVER $46
According to REUTERS, oil rallied on Monday as the world's largest producers gathered in Algeria to discuss ways to support the market, with nervous trade driving volatility to its highest since exporters met in April.
Scepticism about any deal being reached has prompted money managers to cut their bullish bets to a one-month low last week, when prices fell by nearly 5 percent, dented by signs Saudi Arabia and Iran were making little progress in achieving a preliminary agreement to freeze production.
Members of the Organization of the Petroleum Exporting Countries are meeting informally on the sidelines of the International Energy Forum in Algeria from Sept. 26-28, where they will discuss a possible deal to limit output.
Brent crude futures LCOc1 rose 73 cents to $46.62 a barrel by 1052 GMT, having rallied from a session low of $45.74, while U.S. crude prices CLc1 rose 54 cents to $45.02 a barrel.
Implied volatility, one gauge of how much the oil price moves, rose to its highest since April 18, when a meeting in Doha among OPEC members to discuss an output freeze ended in an impasse and the price hit a low just above $40 a barrel.
Unplanned outages across OPEC countries still amount to around 2 million barrels per day, according to SEB commodities strategist Bjarne Schieldrop, which will make it difficult for members that are pumping close to capacity to make way for the potential return of that shuttered output.
"They will come away with nothing, because it is too difficult. How can they decide a freeze when Libya is on the doorstep of returning production, or Nigeria for that matter?" Schieldrop said.
Data from the U.S. Commodity Futures Trading Commission on Friday showed hedge fund managers cut their net long position in crude oil to its lowest in a month, having made the largest weekly addition to their short positions on record.
Sources told Reuters on Friday that Saudi Arabia did not expect a decision to be made in Algeria, while Saudi Arabia had offered to reduce production if Iran caps its own output this year, an offer to which Tehran had yet to respond.
"The fact countries like Algeria are still talking about a deal means it's still on the table regardless of others' views about what might be happening," said Jonathan Barratt, chief investment officer at Sydney's Ayers Alliance.
"I expect Algeria and Venezuela to keep pushing for a deal - it's imperative for them to keep the price up," Barratt said.
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AN - China National Offshore Oil Corp. (CNOOC) is willing to invest $3 billion in its existing oil and gas operation in Nigeria, the Nigerian National Petroleum Corporation (NNPC) said on Sunday following a meeting with the Chinese in Abuja.
REUTERS - Production at Libya’s giant Sharara oil field was expected to fall by at least 160,000 barrels per day (bpd) on Saturday after two staff were abducted in an attack by an unknown group, the National Oil Corporation (NOC) said.
IMF - Output grew by 3.8 percent in 2017, underpinned by a resilient non-hydrocarbon sector, with robust implementation of GCC-funded projects as well as strong activity in the financial, hospitality, and education sectors. The banking system remains stable with large capital buffers. Growth is projected to decelerate over the medium term.
IMF - Higher oil prices and short-term portfolio inflows have provided relief from external and fiscal pressures but the recovery remains challenging. Inflation declined to its lowest level in more than two years. Real GDP expanded by 2 percent in the first quarter of 2018 compared to the first quarter of last year. However, activity in the non-oil non-agricultural sector remains weak as lower purchasing power weighs on consumer demand and as credit risk continues to limit bank lending.