By Colleen Howe
BEIJING (Reuters) -Brent crude futures edged up on Friday, partially reversing losses from the previous session as traders speculated on whether the OPEC+ producer group would come to an agreement on further supply cuts.
Brent crude futures rose by 19 cents, or 0.23%, to $81.61 by 0800 GMT, having settling 0.7% down in the previous session.
U.S. West Texas Intermediate crude lost 45 cents, or 0.58%, from Wednesday’s close to $76.65 a barrel. There was no settlement for WTI on Thursday owing to a U.S. public holiday.
Both contracts are on track for their first weekly rise in five, supported by expectations that Saudi-led OPEC+ could reduce supply to balance the market into 2024.
The Organization of the Petroleum Exporting Countries (OPEC) and allies, together known as OPEC+, surprised the market with an announcement on Wednesday that it would postpone a ministerial meeting by four days to Nov. 30 after producers struggled to reach a consensus on production levels.
“The most likely outcome now appears to be an extension of existing cuts,” IG analyst Tony Sycamore wrote in a note.
The surprise delay had initially brought Brent futures down as much as 4% and WTI by as much as 5% in Wednesday’s intraday trading.
Trading remained subdued because of the Thanksgiving holiday in the United States.
The near-term economic outlook in China, meanwhile, supported market sentiment.
Recent Chinese data and fresh aid to the indebted property sector can be “positive for the oil market’s near-term trend”, said CMC Markets analyst Tina Teng.
Chinese stocks rose on Thursday on expectations that China would direct more stimulus to the struggling property sector.
Yet those gains could be capped by higher U.S. crude stockpiles and poor refining margins, leading to weaker demand from U.S. refineries, analysts said.
“Fundamentals developments have been bearish with rising U.S. oil inventories,” ANZ analysts said in a note.
China’s longer-term outlook is lukewarm, however. Analysts say oil demand growth could weaken to about 4% in the first half of 2024 as the property sector crunch weighs on diesel use.
Non-OPEC production growth is set to remain strong, with Brazilian state energy company Petrobras planning to invest $102 billion over the next five years to boost output to 3.2 million barrels of oil equivalent per day (boepd) by 2028, up from 2.8 million boepd in 2024.
(Reporting by Colleen HoweEditing by Sonali Paul, Stephen Coates and David Goodman)
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