Oil rose on Friday on expectations that OPEC and its allies would agree to cut output next month but prices were still down on the week on concerns that the global market was oversupplied.
Brent was up $1.15 at $67.77 a barrel by 1150 GMT. The global benchmark looked set for a third day of gains since hitting an eight-month low on Tuesday. But it was still down more than 3 percent on last week’s close.
U.S. light crude was up 90 cents at $57.36 after their steepest one-day loss in more than three years on Tuesday.
Ministers from the Organization of the Petroleum Exporting Countries (OPEC) meet on Dec. 6 in Vienna to decide on production policy for the next six months. They have to decide what to do about a growing surplus in world markets.
The United States imposed sanctions on Iran this month, asking international consumers not to buy its oil, and Iranian crude exports have fallen sharply in recent months.
But other oil producers have more than compensated for the lost Iranian oil and most analysts now see a significant supply surplus with inventories building, putting pressure on prices.
“The trend is down – stick with it,” PVM technical analyst Robin Bieber said.
OPEC is widely expected to start trimming output soon, fearing a repeat of the 2014 price rout.
This could produce a swift price rebound, some analysts say, especially if production falls further in Venezuela and Libya.
“We are likely from December onwards to have at least 1 million barrels per day (bpd) less of (Iranian) crude exports,” Harry Tchilinguirian, global head of commodity markets strategy at BNP Paribas, told Reuters Global Oil Forum.
Tchilinguirian said he would not be surprised if Brent recovered to $80 a barrel this year.
OPEC’s de facto leader, Saudi Arabia, wants the cartel to cut output by about 1.4 million bpd, around 1.5 percent of global supply, sources told Reuters this week.
The Saudis would like Russia to cut output but Moscow has yet to commit to joint action.
Iraq resumed exporting oil from its northern Kirkuk oilfields on Friday, pumping 50,000-100,000 bpd, an oil ministry spokesman told Reuters. Some analysts had expected the volumes to be much higher, at closer to 300,000 bpd.
While OPEC considers withholding supply, U.S. oil production reached another record last week, at 11.7 million bpd, U.S. data showed.
The record output helped U.S. crude oil stocks to their biggest weekly build in nearly two years.
