Oil prices steady ahead of OPEC meeting on supply cut extension

 

SEOUL: Oil prices held steady in early Asian trade on Friday as the market waited to see whether major oil producers would extend supply cuts beyond March at a meeting in Vienna later in the day.

International benchmark Brent crude futures were at $56.40 a barrel at 0046 GMT (5:46 AM PST), down 3 cents (or 0.05 percent) from their last close. US West Texas Intermediate (WTI) crude futures, on the other hand, were up 7 cents (or 0.14 percent) at $50.62 per barrel.

The Organization of the Petroleum Exporting Countries (OPEC) and other producers are set to meet in Vienna at 0800 GMT (1 PM PST) on Friday to discuss a possible extension of an oil supply cut deal to prop up prices.

There will be some focus on whether Nigeria and Libya, who have been exempt from the curbs, will join any future cuts. The two OPEC members have both been invited to the meeting.

“The market is still split as to whether the meeting will bring fresh supply cuts to the table,” ANZ bank said in a note.

“With US stockpiles remaining elevated, a firm signal about lower supply is likely needed for price momentum to remain positive.”

OPEC and some non-OPEC producers including Russia first agreed in November last year to cut their output by around 1.8 million barrels per day (BPD) to clear global oversupply and support prices.

Despite their concerted efforts — the oil cartel extended their supply cuts until the end of March — prices have remained depressed amid increasing US oil production.

The Energy Information Administration (EIA) reported on Wednesday that US crude production reached 9.51 million BPD in the week ended September 15, up from 8.78 million BPD a week ago.