As the hours count down to the highly-anticipated meeting of the Organization of the Petroleum Exporting Countries (OPEC) and non-members in Vienna, mixed signals are increasing from participants with regards to the prospect that the cartel will extend its production cutback initiative beyond next March.
OPEC and its allies have agreed to reduce production by about 1.8 million barrels per day up to March 2018 in an effort to reduce global supply surplus.
While many analysts expect them to extend the deal that now lasts until March, many also said prices at current levels could encourage some countries to boost production.
"Not at this time, no", he said on arrival in Vienna, when asked if the OPEC/non-OPEC monitoring committee meeting Friday would include consideration of any proposals to extend the cuts, noting that the coalition only extended the original agreement, which had been set to expire in June, in May.
OPEC will meet again on Friday (September 22) to discuss an extension to its current deal to cut output and reduce the global supply glut.
Both are exempt from the deal to curb output and their resulting boost to production has weighed on prices. "But that could change in a hurry if OPEC disappoints (again) or if the US oil production machine roars back to new multi-year highs in the coming weeks". US West Texas Intermediate (WTI) crude futures, on the other hand, were up 7 cents (or 0.14 percent) at $50.62 per barrel.
Hurricanes in the Gulf of Mexico have also pushed up crude inventories in some parts of the United States as refineries have been shut by flooding.
"The (oil futures) contracts have performed well in recent sessions but are struggling for traction", Brennock added.
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USA crude stocks rose a less than expected 1.4 million barrels at the end of last week, the American Petroleum Institute (API) said on Tuesday, while gasoline stocks fell 5.1 million barrels and distillates dropped 6.1 million barrels.
Essam al-Marzouq said compliance with output cuts was improving and above 100 percent: "It is very good, better than last month".