Oil prices increase as Saudi Arabia plans to extend supply cut deal
Oil prices have risen after Saudi Arabia's Oil Minister Khalid al-Falih reportedly discussed extending the ongoing crude supply cut deal beyond March next year with his Venezuelan and Kazakh counterparts.
London Brent crude for November delivery LCOc1 soared by 30 cents to touch $54.08 a barrel, while US crude for October delivery CLc1 was trading 41 cents higher at $47.89 per barrel, reported Reuters.
Reports of a possible extension helped to decrease the pressure on oil prices amid growing concerns of a fall in energy demand due to Hurricane Irma and its aftermath.
The hurricane that hit Florida is expected to weaken and turn into a tropical storm as it moves towards northern Florida and southern Georgia.
Hurricane Harvey that struck US Gulf coast nearly two weeks ago forced the country's refinery output rate to a seven-year low.
Oil refineries that stopped production are now gradually restarting their activities.
At the end of the last year, members of the Organization of the Petroleum Exporting Countries (OPEC) and other key petroleum producers agreed to reduce crude production by 1.8 million barrels per day from January this year to rebalance the oil market and support prices.
The deal was later extended to March 2018.
The news agency reported that the Saudi Arabian Energy Minister Khalid al-Falih agreed with his Kazakh counterpart that an extension of the agreement to revive oil prices will be considered in due course.
Meanwhile, an Iranian official told Reuters that domestic oil production rate will increase to 4.5 million barrels per day (bpd) within the next five years.