Oil extended its advance above $44 a barrel after posting the biggest weekly increase since April amid speculation that producers will revive talks to stabilize prices.
Futures rose as much as 0.9 percent in New York after climbing 6.4 percent last week as Saudi Arabia signaled it’s prepared to discuss stabilizing markets at informal OPEC discussions next month. Venezuela’s oil and foreign ministers will visit producer countries to lobby for price increases ahead of the talks, President Nicolas Maduro said. U.S. producers added rigs for a seventh week, the longest run since 2014, according to Baker Hughes Inc. data on Friday.
Oil has rebounded more than 10 percent since closing below $40 a barrel and tumbling into a bear market earlier this month. Saudi Arabian Energy Minister Khalid Al-Falih said in a statement last week that talks with Organization of Petroleum Exporting Countries members and other producers may result in action to stabilize the market, the state-run Saudi Press Agency said.
“Oil is now close to an equilibrium price, and unless we get further developments, I would expect to see it trading around the $44 to $45 level for the balance of the week,” said Michael McCarthy, a chief market strategist in Sydney at CMC Markets. “It wouldn’t surprise me to see a little bit of pressure as some investors lock in some of the gains they’ve made.”
West Texas Intermediate for September delivery rose as much as 46 cents to $44.95 a barrel on the New York Mercantile Exchange and was at $44.87 at 11:12 a.m. in Hong Kong. Prices advanced $1 to settle at $44.49 a barrel on Friday, the highest since July 21. Total volume traded was about 40 percent below the 100-day average.
U.S. Rigs
Brent for October settlement added as much as 43 cents, or 0.9 percent, to $47.40 a barrel on the London-based ICE Futures Europe exchange. The contract increased 2 percent to close at $46.97 on Friday. The global benchmark crude traded at a $1.76 premium to WTI for October delivery.
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Rigs targeting crude in the U.S. increased by 15 to 396, the highest level since February, according to data from Baker Hughes. Explorers have now added 66 rigs since June 24, led by rising activity in the Permian Basin.
Oil-market news:
Venezuela has begun coordinating efforts among OPEC members and producers outside of the group including Russia, Venezuelan President Nicolas Maduro said on state television. Nigeria will pump no more than 1.5 million barrels a day of oil this year as sustained attacks by militants have damaged infrastructure including its biggest export terminal, Minister of State for Petroleum Emmanuel Kachikwu said in an interview Friday.
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