Oil prices have increased marginally on the prediction that non-OPEC producers may agree to reduce oil production.
The non-OPEC nations are scheduled to meet the members of the oil cartel this weekend to discuss oil production limits at Vienna, Austria.
Brent crude for the LCOc1 February delivery gained 12¢ to touch $54.01 a barrel rising 1.7%, while US crude for the CLc1 January delivery was up by 32¢ at $51.16 per barrel, reported Reuters.
Azerbaijan stated that it will reach Vienna with its own proposals, while Russia said that it will reduce production by 300,000 barrels a day.
The other non-OPEC members need to commit to reduce oil output by another 300,000bpd to meet OPEC’s anticipated target of 600,000bpd.
Mitsubishi UFJ research and consulting senior economist Tomomichi Akuta was quoted by Reuters as saying: “There are hopes for deeper cuts as non-OPEC nations are set to cooperate in curbing production.
“But it is still uncertain whether their cuts would reach 600,000bpd, which is providing limited support to oil gains.”
Last week, OPEC agreed to reduce daily production by 1.2 million barrels that briefly increased oil prices.
According to refinery sources, Saudi Arabia and Iraq will supply full contracted volumes of crude to Asia in January to maintain their market share.
Oil market investors are currently looking forward to the weekly data on US oil rig counts provided by Baker Hughes, as well as the outcome of the meeting in Vienna, which would define the future of the oil market.