Oil rebounds from 8-week low as OPEC said to work secure deal

Hong Kong - Oil rebounded from the lowest close in eight weeks as Organisation of Petroleum Exporting Countries (OPEC) nations were said to be making a final diplomatic effort toward securing a deal to curb production and stabilize prices.

Futures rose as much as 2.6% in New York after falling 4.3% the previous three sessions.

Qatar, Algeria and Venezuela are leading the push to finalise a deal, while Saudi Arabia, Iraq and Iran are at odds over how to share output cuts agreed at a September meeting in Algiers, according to a delegate familiar with the talks.

US crude stockpiles are forecast to gain for a third week, according to a Bloomberg survey before government data Wednesday.

Oil has retreated for almost four weeks amid scepticism about the ability of the OPEC to implement a deal at its November 30 meeting.

The group is seeking to trim output for the first time in eight years as Iran boosts production and Iraq seeks an exemption because of war with Islamic militants.

Prices will probably remain around current levels if OPEC fails to cut, according to BP chief executive officer Bob Dudley.

"There is likely to be a deal for 32 million to 33 million barrels a day" when OPEC meets, said Eugen Weinberg, head of commodities research at Commerzbank in Frankfurt.

"But no individual quotas, since they would not agree on numbers."

West Texas Intermediate crude for December delivery rose as much as $1.11 to $44.43 a barrel on the New York Mercantile Exchange, and was at $44.34 at 9:26 in London.

The contract dropped 9 cents to $43.32 on Monday, the lowest close since September 19. Total volume traded was about 83% above the 100-day average. Prices slid 1.5% last week.

Iran freeze

Brent for January settlement gained as much as 95 cents to $45.38 a barrel on the London-based ICE Futures Europe exchange. The contract fell 32 cents to $44.43 on Monday, the lowest close since August 10.

The global benchmark traded at a 36-cent premium to WTI for January delivery.

Iran is considering a proposal to freeze its oil production near the level the country says it pumps - almost 4 million barrels a day - rather than OPEC’s estimate of about 3.7 million, the delegate said.

OPEC pledged in Algiers to bring its production down to a range of 32.5 million to 33 million barrels a day, which compares with output of 33.6 million last month.

Oil-market news:

Oil supply and demand are "generally in balance," BP CEO Dudley said in a Bloomberg television interview in Riyadh on Tuesday.

Hedge fund manager Pierre Andurand says OPEC is still likely to agree on an output freeze this month and prompt a sharp rally in oil prices, despite disputes among its members.

US crude stockpiles probably increased by 1 million barrels last week, according to the median estimate in a Bloomberg survey before an Energy Information Administration report.