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Brent, NYMEX up in Asia on rebound as OPEC meeting in focus

Published 09/25/2016, 10:14 PM
Updated 09/25/2016, 10:15 PM
NYMEX, Brent up in Asia
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Investing.com - Crude oil prices held gains in Asia on Monday, rebounding from a sharp on Friday with the focus on OPEC talks later in the week.

On the New York Mercantile Exchange, crude oil for delivery in November rose 0.88% to $44.87 a barrel. On the ICE Futures Exchange in London, Brent oil for November delivery gained 0.82% to $46.86 a barrel.

On center stage this week is the outcome of the Organization of Petroleum Exporting Countries get-together on Wednesday on efforts to freeze production in tandem with Russia.

As well, U.S. stockpile data on Tuesday and Wednesday remains key for for fresh supply-and-demand signals.

Last week, oil futures fell sharply on Friday, paring weekly gains, as sentiment took a hit amid concerns that the upcoming meeting among major oil producers may not yield any action to reduce the global glut.

Prices tanked after a report quoted an unnamed Saudi official who cautioned not to expect a deal and that the meeting would be more a chance to consult than reach a formal agreement.

OPEC members, led by Saudi Arabia and other big Middle East crude exporters, such as Iran and Iraq, will meet non-OPEC producer Russia on the last day of the International Energy Forum, which will be held in Algeria Monday through Wednesday.

According to market experts, chances that the meeting would yield any action to reduce the global glut appeared minimal. Instead, most believe that oil producers will continue to monitor the market and possibly postpone freeze talks to the official OPEC meeting in Vienna on November 30.

An attempt to jointly freeze production levels earlier this year failed after Saudi Arabia backed out over Iran's refusal to take part of the initiative, underscoring the difficulty for political rivals to forge consensus.

Market players continued to focus on U.S. drilling prospects, amid indications of a recent recovery in drilling activity. Oilfield services provider Baker Hughes said late Friday that the number of rigs drilling for oil in the U.S. last week rose by 2 to 418, marking the 12th increase in 13 weeks.

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