New York/doha: Oil rose to a four-month high in London ahead of a meeting in Doha this month where producers will discuss freezing output. Bloomberg
Brent futures rose as much as 2.7 percent, erasing an 1.3 percent loss. Venezuela said the first priority of the April 17 talks should be to cap output, while Azerbaijan said it backs a freeze. Prices dropped earlier after Iraq, Opec’s second-biggest producer, boosted output 2 percent and exports by 18 percent last month, the state-run Oil Marketing Co. said.
“There’s a lot of excitement about the Sunday meeting,” said John Kilduff, partner at Again Capital LLC, a New York hedge fund focused on energy. “Speculation that an agreement will be reached is generating some buying. There should be considerable short covering before the meeting.”
Oil has rebounded after falling to the lowest level in more than 12 years amid signs that a global glut will ease as US output declines. Saudi Arabia, the biggest producer in the Organization of Petroleum Exporting Countries, said it will agree to a freeze only if it’s joined by other suppliers including Iran, while Kuwait said a deal can be done without Tehran’s support.
Brent for June settlement advanced 79 cents, or 1.9 percent, to $42.73 a barrel on the London-based ICE Futures Europe exchange at 10:36 am in New York. The contract earlier rose to $43.06, the highest since December 7. Prices increased 8.5 percent last week. West Texas Intermediate for May delivery rose 65 cents, or 1.6 percent, to $40.37 a barrel on the New York Mercantile Exchange. Futures touched $40.75, the highest since March 23. The contract rose 6.6 percent to $39.72 on Friday, the biggest increase since February 12, to cap an 8 percent weekly gain. Total volume traded was 22 percent above the 100-day average.
Meanwhile, Kuwait Oil Company said it will soon offer contracts for offshore rigs and support services to drill its first undersea wells as the Persian Gulf nation tries to boost crude output to the highest level in more than four decades.
Kuwait is targeting production of 3.165 million barrels a day later this year or in 2017, up from a current 3 million barrels a day, Chief Executive Officer Jamal Jaafar said at a conference in Kuwait City. He made his comments a day after fellow OPEC member Iraq reported a record level of production and less than a week before some of the biggest oil-producing nations are to discuss freezing output to reduce a glut and shore up prices.
