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Oil output levels: Algeria urges market players to reach deal
(MENAFN- Arab News) TEHRAN: Algerian Prime Minister Abdelmalek Sellal urged leading oil market players to reach agreement on levels of production for the sake of price stability in a speech at the Gas Exporting Countries Forum (GECF) Summit in Tehran.
'The main players in the petroleum market must certainly reach an agreement about the levels of production' said Sellal.
'If the petroelum market is not controlled it will witness strong volatility for prices' he added warning that this would negatively affect the 'interests of producers and consumers and the whole petroleum industry.'
Oil prices fell on Monday releasing fleeting gains as a firm dollar and concern over global oversupply reasserted themselves.
Oil prices have halved over the last 12 months after OPEC decided to maintain its production levels or even increase them to retain market share in part by forcing higher-cost producers elsewhere to cut output.
Big hedge funds have increased their bets that oil will continue to fall according to data from the US Commodity Futures Trading Commission (CFTC) last week.
Speculators now hold more positions that are betting on a drop in the oil price than at any time since at least 2009 according to Reuters data.
Morgan Stanley's commodities research team said they expected to see a rise in the physical market toward the end of the year as refinery margins remain robust and maintenance schedules for next month are expected to be light.
US West Texas Intermediate (WTI) crude futures were down 68 cents a barrel at $41.22 by 1413 GMT Monday having touched a session high of $42.75 following the Saudi statement.
Benchmark January Brent futures were last down 23 cents at $44.43 a barrel. The price hit an intraday high of $45.73 earlier in the session.
Saudi Arabia has previously said it is willing to cooperate with other oil producers to maintain oil price stability but new comments on Monday arrived as futures prices were barely holding above 2-1/2 month lows.
But this might not be enough to underpin the broader market analysts said.
'As long as markets are oversupplied even if it's by a shrinking amount technical factors and the US dollar will remain the primary price-setting mechanisms' they said.
'The main players in the petroleum market must certainly reach an agreement about the levels of production' said Sellal.
'If the petroelum market is not controlled it will witness strong volatility for prices' he added warning that this would negatively affect the 'interests of producers and consumers and the whole petroleum industry.'
Oil prices fell on Monday releasing fleeting gains as a firm dollar and concern over global oversupply reasserted themselves.
Oil prices have halved over the last 12 months after OPEC decided to maintain its production levels or even increase them to retain market share in part by forcing higher-cost producers elsewhere to cut output.
Big hedge funds have increased their bets that oil will continue to fall according to data from the US Commodity Futures Trading Commission (CFTC) last week.
Speculators now hold more positions that are betting on a drop in the oil price than at any time since at least 2009 according to Reuters data.
Morgan Stanley's commodities research team said they expected to see a rise in the physical market toward the end of the year as refinery margins remain robust and maintenance schedules for next month are expected to be light.
US West Texas Intermediate (WTI) crude futures were down 68 cents a barrel at $41.22 by 1413 GMT Monday having touched a session high of $42.75 following the Saudi statement.
Benchmark January Brent futures were last down 23 cents at $44.43 a barrel. The price hit an intraday high of $45.73 earlier in the session.
Saudi Arabia has previously said it is willing to cooperate with other oil producers to maintain oil price stability but new comments on Monday arrived as futures prices were barely holding above 2-1/2 month lows.
But this might not be enough to underpin the broader market analysts said.
'As long as markets are oversupplied even if it's by a shrinking amount technical factors and the US dollar will remain the primary price-setting mechanisms' they said.
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