Oil traded near $54 a barrel as two of the world’s largest crude producers provided conflicting guidance about the longevity of a historic supply agreement.
Futures were little changed in New York. OPEC, Russia and other allied oil producers may not decide this month whether to extend production cuts beyond their March expiration, Russian Energy Minister Alexander Novak said on Thursday. That diverged from remarks by Saudi Arabia’s oil chief, who predicted the accord will be renewed at a meeting scheduled for the end of this month.
“There’s a little bit of questioning of the cohesion that’s there, although the Saudis keep at it with their rhetoric,” John Kilduff, a partner at Again Capital LLC, a New York-based hedge fund, said by telephone. “We’re getting pushed around by these competing elements.”
Oil advanced for a second month in October on signs the Organization of Petroleum Exporting Countries and other major crude producers may agree at a Nov. 30 meeting to prolong production caps. Russia’s Novak cast doubt on prospects for an extension when he said in Riyadh that it’s too soon to assess how effective the cuts have been.
Meanwhile, Saudi Oil Minister Khalid Al-Falih said in Bangkok that he expects “improving market conditions to continue, and as my colleagues in OPEC and non-OPEC gather in four weeks in Vienna, I expect that we will renew our resolve to return already improving global inventories to their normal levels.”
West Texas Intermediate for December delivery rose 7 cents to $54.37 a barrel at 9:36 a.m. on the New York Mercantile Exchange. Total volume traded was 10 percent below the 100-day average.
See also: Oil Traders Set Sights on Seas as Diesel Renaissance Gets Going
Brent for January settlement slipped 13 cents to $60.36 on the London-based ICE Futures Europe exchange. The global benchmark crude traded at a premium of $5.77 to January WTI.
“OPEC is not out of the woods,” said Harry Tchilinguirian, head of commodity markets strategy at BNP Paribas SA. “The stock-draws are not enough to reverse the large builds in oil inventories that we saw between 2014 and 2016.”
Royal Dutch Shell Plc released third-quarter earnings Thursday that beat expectations and showed the European major has taken Exxon Mobil Corp.’s cash-flow crown, a year after completing the biggest deal in its history. OPEC output slid by 180,000 barrels a day in October from September, with overall production dipping to 32.59 million barrels a day, according to a Bloomberg survey of analysts, oil companies and ship-tracking data.