Italy’s top oil producer Eni SpA and Oman’s energy minister predict the latest oil price rebound is sustainable in the near future. Prices have surged by more than 20% since dipping below $50 per barrel a few weeks ago. Oman oil minister Mohammed Al-Rumhi told Bloomberg TV that the agreement between the Organization of Petroleum Exporting Countries (OPEC) and its allies including Russia and Oman to cut supplies will help sustain the prices at $60 a barrel. He expects crude price trading in the range of $60-$70 per barrel this year.
Oil prices slipped on Friday as concerns over economic growth resurfaced after inconclusive trade talks between the US and China ended on Wednesday. However, OPEC-led production cuts boosted sentiment in crude markets. Oil prices were also supported by comments from US Federal Reserve Chairman Jerome Powell on Thursday that the US central bank could pause any further interest rate hikes. Asia’s Iranian oil imports were set to rise from December onwards as the United States granted temporary waivers to some countries from sanctions against Iran’s oil exports. International Brent crude futures were at $61.22 per barrel at 0139 GMT.
The Organization of the Petroleum Exporting Countries (OPEC)and its allies aim to publish a statement in January on the implementation of the agreement to cut oil production, according to Russia’s Energy Minister Alexander Novak. The hedge funds have boosted their investments, for a third straight week, betting on a brent price rally amid expectations that OPEC and allies will follow through on the deal to reduce output. A reduction in supply of a commodity generally pushes up the prices. Ashley Petersen, an oil analyst at Stratas Advisors LLC, expects a little more optimism and neutrality coming into markets.