NEW YORK CITY – Oil prices edged higher in volatile trading Wednesday as the market weighed Russia’s comments about a possible meeting with Saudi Arabia on possible output cuts against a bigger-than-expected US crude storage build.
According to Reuters, Brent futures were up 28 cents to $47.23/bbl while US crude rose 32 cents to $46.13/bbl.
Before the US Energy Information Administration released its petroleum status report, both contracts were down less than 1%. That followed a surge of almost 6% on Tuesday on news that OPEC would renew efforts to limit production.
EIA said crude stocks increased by a bigger-than-expected 5.3 MMbbl, topping analysts’ 1.5 MMbbl build projected in a Reuters poll.
Russia, meanwhile, said it was ready to support OPEC’s decision on an oil output freeze and sees big chances that the oil producers’ group can agree on the terms of the freeze by Nov. 30, Russian Energy Minister Alexander Novak was quoted to say.
The US crude build dampened Tuesday’s rally on news that OPEC members were meeting ahead of an official group gathering on Nov. 30 to build consensus for a deal to limit output.
Venezuelan President Nicolas Maduro said he will meet with OPEC secretary-general Mohammed Barkindo in Caracas on Wednesday to discuss the freeze.
A number of energy ministers from OPEC countries are also likely to meet informally in Doha on Friday to try to build consensus over decisions taken by the full group in September in Algiers, an Algerian energy source said.
Those informal meetings could include energy ministers from Saudi Arabia and Russia. But Iran’s oil minister will not be attending, sending the country’s OPEC governor instead, sources said.
Dutch bank ABN Amro, meanwhile, lowered its oil price forecasts on Wednesday, expecting Brent and US crude to average $50/bbl in the fourth quarter.