Oil traded near the lowest level in almost five months in New York as a rebound in US drilling signaled production is withstanding the slump in prices.
West Texas Intermediate futures were little changed, erasing an earlier drop to the lowest price since March 20. The number of U.S. rigs seeking oil rose by 6 to 670 for a third weekly gain, Baker Hughes Inc. data show.
OPEC members Algeria and Libya said the group could meet earlier that its scheduled December gathering to address the crude oversupply.
Oil has slumped more than 25 percent since this year’s peak in June amid signs the global surplus will be prolonged. The Organization of Petroleum Exporting Countries’ largest members have sustained record output, while US inventories remain more than 90 million barrels above the five-year seasonal average.
Societe Generale SA and JPMorgan Chase & Co. cut their price forecasts on weaker demand growth and oversupply.
“The problem is the continued robustness of US production levels, which has failed to deliver the expected slowdown in production,” Ole Sloth Hansen, an analyst at Saxo Bank A/S in Copenhagen, said by e-mail. “The near-term outlook for oil is pretty dim.”
West Texas Intermediate for September delivery rose 5 cents to $43.92 a barrel on the New York Mercantile Exchange at 11:33 a.m. London time. It earlier fell as much as 52 cents to $43.35 a barrel. Prices have decreased 18 percent this year.
Brent for September settlement gained 36 cents, or 0.7 percent, to $48.97 a barrel on the London-based ICE Futures Europe exchange. Prices declined 6.9 percent last week. The European benchmark crude traded at a premium of $5.01 to WTI.
Drillers in the US, the world’s biggest oil consumer, have added rigs to fields for the fifth weekly gain in six, Bakers Hughes said on its website. While the number of active machines has climbed to 670, the total count is still down almost 60 percent since December.
OPEC members are engaged in negotiations on the possibility of holding an emergency meeting, the Algerian official news agency reported Monday, citing the nation’s Energy Minister Salah Khebri. Libya would support an early meeting and wants global oil supply reduced in order to lift prices, Nagi Elmagrabi, chairman of the state-run National Oil Corp., said by phone.
“It doesn’t look right now as if there would be enough of a consensus to hold a meeting,” of OPEC, Paul Horsnell, head of commodities research at Standard Chartered Plc said by e-mail from London.
Societe Generale cut its third quarter forecast for WTI by $12.20 a barrel to $47.80 amid stable U.S. production and a surge in output from the Organization of Petroleum Exporting Countries, analysts including Michael Wittner said in a report last week. JPMorgan reduced its average estimate for WTI in the second half to $44 and its Brent projection to $50, it said in an Aug. 7 report.
China’s crude oil imports rose to a record on a monthly basis driven by buying from small private refineries amid low prices. Overseas purchases increased to 30.71 million metric tons in July, equivalent to about 7.3 million barrels a day, according to preliminary data released by the Beijing-based General Administration of Customs on Saturday.
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