Picture: ISTOCK
Picture: ISTOCK

London — Oil prices were steady on Friday, as investors waited to see whether major producers meeting in Vienna would back an extension to output cuts beyond March 2018.

Brent crude futures were up 28 US cents at $56.71 a barrel at 1.51pm GMT, their highest since March.

US West Texas Intermediate (WTI) crude futures were down 2c, at $50.53 per barrel.

Some ministers from oil cartel Opec, Russia and other producers were meeting in Vienna to discuss their deal to cut supplies, which runs to March. Opec and its allies have been considering extending the deal beyond that date.

Russian energy minister Alexander Novak said Opec and other oil producers would not take a decision until January, while other ministers suggested a decision could come this year.

"I believe that January is the earliest date when we can actually, credibly speak about the state of the market," he said, emphasising that Opec and other major producers needed to work together on a strategy from April 2018.

Oil prices have gained more than 15% in the past three months to trade above $56 a barrel, suggesting the deal is making progress in getting rid of excess supply. Kuwaiti oil minister Essam al-Marzouq, who chaired Friday’s meeting, said that since the supply cuts, "the oil market had markedly improved … and is evidently well on its way towards rebalancing."

Nigeria and Libya, which have been exempt from the curbs, were also invited to attend the talks.

Despite the current output restraints, increasing US oil production has curbed price gains. Hurricanes in the Gulf of Mexico have also pushed up crude inventories as some US refineries have been shut by flooding.

The Energy Information Administration (EIA) on Wednesday reported US crude production rose to 9.51-million barrels per day in the week ended September 15 from 8.78-million barrels per day a week earlier.

Commerzbank said in a note that oil prices were finding some support from tensions sparked by plans by the regional government of Iraqi Kurdistan to hold an independence referendum.

Iraq’s government and Western powers oppose holding such a vote in the oil producing region.

Reuters

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