Plants are pictured near an oil pump, owned by oil company Rosneft, in the settlement of Akhtyrskaya in Krasnodar region, southern Russia, December 21, 2014. Reuters/Eduard Korniyenko
Oil prices rose from near-2015 lows on Thursday after a report sourced to a senior OPEC delegate said Saudi Arabia would propose a deal to balance oil markets with non-OPEC help next year.
Benchmark Brent crude futures LCOc1 were up 88 cents, more than 2 percent, at $43.37 a barrel at 0955 GMT (4.55 a.m. ET). U.S. crude CLc1 was trading 64 cents higher at $40.58 a barrel after sinking below $40 on Wednesday.
Saudi Arabia, which has so far resisted any market intervention to prop up oil prices, will propose the Organization of the Petroleum Exporting Countries (OPEC) cut output by 1 million barrels per day (bpd) next year, Energy Intelligence reported.
An OPEC production cut would only go ahead if non-members like Russia, Mexico, Oman and Kazakhstan commit to joint action, the senior delegate was cited as saying. OPEC ministers are gathering in Vienna for their Friday meeting.
“Oil prices are rising because of the talk that Saudi Arabia will propose a global deal to balance the market,” said Frank Klumpp, oil analyst at Stuttgart-based Landesbank Baden-Wuerttemberg.
Iran’s oil minister was quick to dismiss on Thursday the possibility of limiting Tehran’s production ramp up once Western sanctions are lifted. Iraq’s oil minister said he was willing to have an open discussion on a Saudi proposal.