International benchmark Brent crude is now a third above 2017 lows touched in June and at levels last seen in mid-2015 as futures were up 10 cents, or 0.17 percent, at $59.40 a barrel this week. Brent U.S. West Texas Intermediate (WTI) crude futures were at $52.64 per barrel, virtually unchanged from their last close, but up by a quarter from their June 2017 low.
WTI has been weaker relative to Brent as rising U.S. output has capped prices in the United States.
“Oil raced higher overnight with Brent finishing in sight of the magical $60 a barrel mark, spurred on by Saudi remarks supporting the oil production cut through to the end of 2018,” said Jeffrey Halley, senior market analyst at futures brokerage OANDA in Singapore.
Saudi Arabia’s Crown Prince Mohammad bin Salman said that the kingdom would support extending the output cut in a bid to stabilize oil demand and supply.
The Organization of Petroleum Exporting Countries (OPEC) and some non-OPEC producers including Russia have pledged to curb their production by around 1.8 million barrels per day (bpd) until the end of March to drain a global supply glut. OPEC will meet on Nov. 30 in
Vienna and is expected to discuss extending that agreement.
Oil prices have hovered near their highest for this year in recent weeks amid signs of a tightening market, talk of an extension of the cuts, and geopolitical risks in Iraq and Iran.
Although the rising likelihood that OPEC will extend its output cuts raises expectations for a balanced market, U.S. crude production remains an issue for OPEC as it strives to clear a global overhang.