Oil prices stabilised on Monday after one of the most bearish weeks in months propped up by OPEC comments signalling the group and other producers may take further action to restore market balance in the long term.
Oil production platforms in the Gulf of Mexico started returning to service after Hurricane Nate had forced the shutdown of more than 90 percent of crude output in the area. The prospective restarts kept price gains in check.
“Oil is having trouble to find direction. Mixed signals keep investors busy changing their minds,” said Hans van Cleef, senior energy economist at ABN Amro.
“There is a good chance that we will continue to trade a bit sideways in the coming weeks up to the OPEC meeting.”
The Organization of the Petroleum Exporting Countries is due to meet in Vienna on Nov. 30, when it will discuss its pact to reduce output in order to prop up the market.
OPEC Secretary-General Mohammad Barkindo said on Sunday that consultations were under way for an extension of the agreement beyond March 2018 and that more oil-producing nations may join the supply pact, possibly at the November meeting.
He also said OPEC members and other producers may have to take some “extraordinary measures” to ensure the market is in balance in the long term.
Global benchmark Brent crude was down 16 cents at $55.46 a barrel at 1117 GMT. Earlier in the session it touched a three-week low of $55.06 after ending last week 3.3 percent lower, its biggest weekly loss since June 2016.
US West Texas Intermediate crude futures were trading at $49.38, up 9 cents. They came close to a four-week low when they fell to $49.13 earlier in the session. WTI’s losses last week came to 4.6 percent.
Market sentiment in the US remains strong. Money managers raised their bullish bets on US crude futures for the third week in a row, the US Commodity Futures Trading Commission reported on Friday.
However, data published by InterContinental Exchange showed investors had slightly reduced their bets on rising Brent prices in the week ending Oct. 3.
Speculators cut net long Brent positions from a record reached the previous week to 504,263, ICE said.
“Brent crude is thus at risk to the downside if speculators and investors decide to take yet more money off the table,” said Bjarne Schieldrop, chief commodities analyst at SEB Markets.
Oil prices stable after OPEC signals possible further action