Share

Oil prices soar on possible UAE output talks

New York - Oil prices soared Friday, with US crude rebounding from a 2003 low, on reports that OPEC was willing to organise output cuts that could ease the global oversupply.

US benchmark West Texas Intermediate for March delivery shot up $3.23 (12.3%) to $29.44 a barrel on the New York Mercantile Exchange.

The contract had lost more than $4 in the prior four sessions, sinking to the lowest level since May 2003.

Brent crude for April delivery, the European benchmark, finished at $33.36 a barrel in London, up $3.30 (11%) from Thursday's settlement.

A big catalyst was a Wall Street Journal report that United Arab Emirates oil minister Suhail Al Mazrouei had said the OPEC cartel was willing to cooperate with other producers on trimming crude output.

The report was apparently based on a reporter's tweet of the minister's interview with Sky News Arabia. But it was enough to spark a huge turnaround in the market.

James Williams of WTRG Economics discounted the report.

"We have another series of rumors about OPEC based upon a comment out of UAE and another attempt to support prices out of Venezuela, which has scaled back its requests and is just asking for OPEC and non-OPEC exporters to agree not to increase production," he said.

Bart Melek of TD Securities said a six percent drop in US crude oil drilling activity reported by Baker Hughes had also reinforced sentiment.

The US rig count fell by 28 to 439 last week, as low as it was in 2010, Melek said.

"So ultimately we should expect lower production... and with lower production in the US, it's more likely Saudi Arabia and other OPEC members might want to decrease output."

We live in a world where facts and fiction get blurred
Who we choose to trust can have a profound impact on our lives. Join thousands of devoted South Africans who look to News24 to bring them news they can trust every day. As we celebrate 25 years, become a News24 subscriber as we strive to keep you informed, inspired and empowered.
Join News24 today
heading
description
username
Show Comments ()
Rand - Dollar
18.94
-0.0%
Rand - Pound
23.90
+0.0%
Rand - Euro
20.41
+0.1%
Rand - Aus dollar
12.33
+0.1%
Rand - Yen
0.13
-0.0%
Platinum
908.05
+1.2%
Palladium
1,014.94
+1.3%
Gold
2,232.75
-0.0%
Silver
24.95
-0.1%
Brent Crude
87.00
+1.8%
Top 40
68,346
0.0%
All Share
74,536
0.0%
Resource 10
57,251
0.0%
Industrial 25
103,936
0.0%
Financial 15
16,502
0.0%
All JSE data delayed by at least 15 minutes Iress logo
Company Snapshot
Editorial feedback and complaints

Contact the public editor with feedback for our journalists, complaints, queries or suggestions about articles on News24.

LEARN MORE
Government tenders

Find public sector tender opportunities in South Africa here.

Government tenders
This portal provides access to information on all tenders made by all public sector organisations in all spheres of government.
Browse tenders