Some of the world's biggest oil nations are planning a meeting in Russia later this month to discuss a proposed output freeze. Nigeria's oil minister expects "dramatic price movement" from the talks.
Oil prices rose in Asia on Friday after Nigerian oil minister Emmanuel Ibe Kachikwu (pictured above) said Thursday that the meeting would be held on March 20 in hopes of producing a "dramatic price movement."
As US benchmark WTI and Brent Crude each rose more than 30 cents a barrel, oil extended a week of gains after wallowing near 13-year lows below $30 a barrel in January due to a supply glut and a slowdown in the global economy.
Kachikwu told a news conference in Abuja that crude prices were "beginning to inch up very slowly," and expressed the hope for a real spike in prices from the meeting.
"Both the Saudis and the Russians, everybody is coming back to the table," Kachikwu said. "I think we're very humbled today to accept that if we get to a price of $50, it will be celebrated. That's a target that we have."
The Russian Energy Ministry said in a statement Friday it was ready for talks, but added that "various options" about the venue and date for the meeting are still being worked out.
OPEC leader Saudi Arabia and non-OPEC Russia, the world's two largest oil exporters, agreed last month to freeze output at January levels to prop up prices if other nations agreed to join the first global oil pact in 15 years.
Yet the accord has so far failed to have a dramatic impact on crude prices, partly because OPEC's third-largest producer Iran plans to steeply raise production after the lifting of international sanctions on the Islamic Republic in January.
Market strategist Bernard Aw from IG Markets Singapore told AFP that for the potential meeting between OPEC members and Russia to bear fruit, the major producers have to be present.
"If the big players such as Saudi Arabia, Iran, Iraq, agree to freeze output, it could help somewhat. But, the fundamentals of the market remain largely unchanged, it is still quite oversupplied. Maybe in the short term it will help development in the oil market, we could see a return to maybe $40."
Another boost to the battered commodity was US Energy Information Administration (EIA) data released Thursday showing oil production falling to just over nine million barrels per day in the week to February 26.
uhe/ba (AFP, Reuters)