By: Mahmoud Gamal
Mubasher: Oil prices gained on Monday on the back of hopes that the Organisation of Petroleum Exporting Countries (OPEC) and Russia will reach an agreement to trim production late next week.
Traders in the market, however, warned of upcoming pressures following the double-digit growth of US oil rigs.
Mixed Brent grew 57 cents or 1.22% to $47.37 per barrel (pb) by 03:00 GMT, while Western Texas Intermediate (WTI) added 47 cents or 1.01%, reaching $46.83 pb.
Last week, mixed Brent and WTI surged by around 5%, marking their first weekly gain in almost a month.
A report released by Baker Hughes Oilfield Services on Friday showed a rise in US oil rigs by 19 rigs in the past week.
Oil prices received a strong boost ahead of the OPEC meeting, in which the organisation is expected to put the final touches to its deal for reducing oil production, analyst Ahmed Karam told Mubasher.
He added that the year-long deal would be subject to a revision after 6 months.
The agreement entails trimming production from a current 33.7 million barrels per day (mbpd) to between 32.5 and 33 mpbd.
The output cut is likely to receive further backing from outside OPEC, especially after Russia recently raised its production to 11.2 mbpd, the analyst noted.
Iran and Iraq, however, continue to hinder the deal, Karam said, adding that Iran insists on raising its production to 4.2 mbpd from the 3.9 mbpd OPEC is calling for.
Meanwhile, Iraq requested that it be excluded from the deal on claims that it is fighting ISIS.
Oil prices may suffer selling pressures, especially after US oil rigs, which are the main reason behind the supply glut, continue to increase their output.
Translated by: Nada Adel Sobhi
