Oil traded near the highest close in two weeks as investors weighed OPEC’s plans to hold informal talks next month.
Futures were little changed in New York after rising 2.9 percent Monday. Members of the Organization of Petroleum Exporting Countries are in “constant deliberations” on stabilizing the market, according to Mohammed Al Sada, Qatar’s energy minister and the group’s president. While OPEC members intend to discuss the market at the International Energy Forum in Algiers, there are no plans to revive the output-freeze proposal that failed in April, two delegates said last week.
Oil has fluctuated since closing in a bear market last week. Prices are expected to rise later this year as demand strengthens, according to the statement from Al-Sada on the OPEC website. While U.S. crude and fuel stockpiles remain at the highest seasonal level in at least two decades, Goldman Sachs Group Inc. forecasts the market will be in a modest deficit during the second half of 2016.
“Even if a freeze were to materialize, it is unlikely to impact physical OPEC supplies,” Seth Kleinman, European head of energy research at Citigroup Inc. in London, said in a report. “It would be more a signal of OPEC’s ability to coordinate action.”
West Texas Intermediate for September delivery traded 2 cents higher at $43.04 per barrel on the New York Mercantile Exchange as of 12:54 p.m. in London. Prices increased $1.22 to settle at $43.02 per barrel on Monday, the highest close since July 25. Total volume traded was about 14 percent below the 100-day average.
Brent for October settlement was little changed at $45.35 per barrel, recouping an earlier loss of as much as 59 cents, or 1.3 percent, on the London-based ICE Futures Europe exchange. Prices gained 2.5 percent to settle at $45.39 on Monday, the highest close since July 22. The global benchmark traded at a $1.58 premium to WTI for October.
The recent decline in prices and current volatility is temporary, Al-Sada said. Higher demand is expected during the third and fourth quarters of this year and the market is on the path to rebalancing, he said. The forum in Algiers takes place from Sept. 26 to 28.
Venezuela is seeking a meeting with OPEC nations and producers from outside the group to reach an agreement on boosting prices, according to Oil Minister Eulogio Del Pino.
Russia sees no need for renewing discussion of an oil-output freeze at current crude prices, while leaving open the possibility for the future, Energy Minister Alexander Novak told journalists in Moscow on Monday.
U.S. crude stockpiles probably fell by 1.5 million barrels last week, according to the median estimate in a Bloomberg survey before an Energy Information Administration report Wednesday.