The US light, sweet crude oil price for November rose for a fourth consecutive session Oct. 3 to settle just above $48.80/bbl, marking the highest front-month settlement since July 1. The Brent crude oil contract for December settled at nearly $50.90/bbl, its highest front-month closing since Aug. 18.
Oil prices have climbed since the Organization of the Petroleum Exporting Countries said Sept. 28 that it’s willing to consider lowering production although details have yet to be worked out pending a November OPEC meeting.
OPEC indicated after a meeting in Algeria that it’s willing to try and reduce the cartel’s total output to 32.5-22 million b/d although individual quotas have yet to be worked out.
Olivier Jakob, a Petromatrix analyst, noted that the physical oil market remains oversupplied.
“Nigeria and Libya are looking to bring more crude into the market, and this is why the recent rally was relatively modest,” Jakob said.
Morgan Stanley analysts said the risk of disappointment over the pending OPEC decision remains high, adding that the proposal could just be a way to calm a jittery market for now.
More discussions were needed, particularly with major non-OPEC producers such as Russia, Morgan Stanley said.
The natural gas contract for November gained nearly 2¢ to a rounded $2.92/MMbtu. On the spot market, the Henry Hub gas price declined 3¢ to $2.81/MMbtu.
Heating oil for November gained a rounded 1.5¢ to a rounded $1.55/gal. The price for reformulated gasoline stock for oxygenates blending for November rose less than a penny to a rounded $1.47/gal.
The December Brent crude contract on London’s ICE increased 70¢ to settle at $50.89/bbl and the January contract climbed 71¢ to settle at $51.46. The October gas oil contract settled at $448.25/tonne, up $1.50.
The average price for OPEC’s basket of benchmark crudes on Oct. 3 was $46.64, up $2.01.
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