London — Oil futures rose slightly on Tuesday to their highest levels in almost six weeks on optimism that Opec and other producing countries may agree to extend output cuts to support prices.
Brent was up 7c at $62.66 a barrel by 8.40am GMT, while US West Texas Intermediate (WTI) futures were up 15c, or 0.6%, at $58.17 a barrel.
Brent earlier hit its highest level since August 1, while US crude rose to its highest since July 31.
Prince Abdulaziz bin Salman, Saudi Arabia’s new energy minister and a long-time member of the Saudi delegation to Opec, said the kingdom’s policy would not change and a global deal to cut oil production by 1.2-million barrels a day would be maintained.
He added that the so-called Opec-plus alliance, made up of Opec and non-Opec producers including Russia, would be in place for the long term.
“Clearly, the kingdom wants higher oil prices … Prince Abdulaziz made clear that ‘no radical’ change in the Saudi oil policy is forthcoming,” said Tamas Varga of oil brokerage PVM.
“It will be interesting to see if we get any hint from him whether the producer group in general and Saudi Arabia in particular sees the need for deeper production cuts.”
The Opec-plus joint ministerial monitoring committee (JMMC), which reports on compliance with the cuts, is due to meet on Thursday in Abu Dhabi.
There have been concerns about producers’ adherence to the agreement as Opec members Iraq and Nigeria, among others, exceeded their quota in August and Russia also did not fully comply.
“Markets will need to see concrete progress on the production front, even as the world’s economy slows, to sustain gains,” said Jeffrey Halley, senior market analyst at Oanda.
Should oil markets close higher on Tuesday it will be the longest run of gains since late July but headwinds remain due to US-China trade tension.
Executives at the annual Asia-Pacific Petroleum Conference said on Monday they expect oil prices in 2019 to be under pressure due to uncertainties surrounding the global economy, the US-China trade war and increasing US supply.
In the US, crude stockpiles are likely to have fallen for a fourth consecutive week last week, a preliminary Reuters poll showed on Monday.
Five analysts polled by Reuters estimated, on average, that crude inventories fell 2.6-million barrels in the week to September 6.