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Reuters
NEW YORK
Oil rose nearly 1 percent on Friday on expectations that the Organisation of the Petroleum Exporting Countries (OPEC) and its allies would agree to cut output next month, though prices were set for a weekly drop on underlying concerns that the global market was oversupplied.
OPEC's Saudi Arabia is keen for the major producers to cut output by about 1.4 million barrels per day, around 1.5 percent of global supply, to support the market, sources told Reuters this week. But other producers, including Russia, have been reluctant to agree to a cut.
Brent was up 60 cents a barrel at $67.22 by 11:30 a.m. EDT [1630 GMT]. The global benchmark looked set for a third day of gains since hitting an eight-month low on Tuesday, but was down more than 4 percent on last week's close.
U.S. light crude was up 44 cents at $56.92 a barrel after earlier hitting a session high of $57.96. The contract had its steepest one-day loss in more than three years on Tuesday. U.S. crude is set to fall 5.6 percent in the week.
"A relief rally was in the cards," said Bob Yawger, director of energy futures at Mizuho in New York. OPEC is likely to be spurred to action as U.S. production continues to climb, he said.
Still, the day's gains are likely to be limited as traders are cautious going into the weekend, he said."It would take a brave soul to go home really long this weekend considering the slaughter we've had in the past eight weeks."
OPEC ministers meet on Dec. 6 in Vienna to decide on production policy for the next six months amid a growing surplus in world markets.
U.S. crude production reached another record last week, at 11.7 million barrels per day, government data showed. The record output contributed to the biggest weekly build in U.S. crude stockpiles in nearly two years.
An indicator of future production, the Baker Hughes' weekly U.S. drilling rig count data, was due at 1 p.m..
The United States imposed sanctions on Iranian oil exports this month and
Iranian crude exports have fallen sharply in recent months, although Washington cushioned the blow by granting some temporary exemptions.
