Oil rebounds as Iraq signals deeper cuts ahead of Opec+ meeting

[SEOUL] Oil rebounded from the biggest weekly loss since early October after Iraq signalled Opec and its allies will consider deeper production cuts at its meeting later this week, contrary to indications from the group.

Futures surged as much as 1.9 per cent in New York after plunging 5.1 per cent on Friday, the largest loss in more than two months. The reduction could be about 400,000 barrels a day, Iraq's oil minister Thamir Ghadhban told reporters in Baghdad on Sunday, adding that the nation complied with its commitments to lowering output last month. A gauge of China's manufacturing sector jumped unexpectedly in November, suggesting a recovery in activity.

Oil capped a second monthly gain in November on signs Beijing and Washington are close to an initial trade deal, even after the US passed legislation expressing support for Hong Kong protesters.

Saudi Arabia will probably indicate to the the Organization of Petroleum Exporting Countries and its allies at the meeting in Vienna that it's no longer willing to compensate for other members' non-compliance, according to people familiar.

West Texas Intermediate for January delivery rose US$1.05 to US$56.22 a barrel on the New York Mercantile Exchange as of 9.07am Singapore time. Prices lost 5.1 per cent to close at US$55.17 on Friday. There was no settlement Thursday due to the holiday in the US and all transactions were booked on Friday.

Brent for February settlement advanced 85 cents, or 1.4 per cent, to US$61.34 a barrel on London's ICE Futures Europe Exchange. The January contract expired Friday after dropping 2.3 per cent. The global benchmark crude traded at a US$5.20 premium to WTI for the same month.

BLOOMBERG