Oil was poised for its biggest quarterly gain in more than a year on forecasts for rising demand and Turkey’s threat to halt Kurdish exports through its territory after the region voted for independence from Iraq.
Futures were little changed in New York and up about nine percent for September. OPEC and the International Energy Agency this month boosted demand forecasts, signalling the surplus that has weighed on prices may shrink further. Iraq said Thursday that Turkey agreed to deal exclusively with its government over exports of Kurdish crude, a step that could disrupt shipments from the region.
Oil this week returned to a bull market on signs the persistent crude surplus was finally starting to shrink, while Trafigura Group and Citigroup Inc. warned of a further supply squeeze in 2018. The Organization of Petroleum Exporting Countries and Russia have hailed the success of their agreement to cut production and urged their allies to stay focused on finishing the job. The effects of Hurricane Harvey, which shut down a large number of refineries on the U.S. Gulf Coast, have begun to fade.
Prices rose sharply “as traders anticipated renewed demand from U.S. refiners resuming operations after shutdowns due to Hurricane Harvey,” analysts including Ashley Kelty at Cenkos Securities Plc wrote in a note. Futures also gained as producers indicated “they will stick with output cuts to limit supply,” they said.
West Texas Intermediate for November delivery was unchanged at $51.56 a barrel at 8:34 a.m. on the New York Mercantile Exchange. Total volume traded was about 18 percent below the 100-day average. Prices lost 58 cents to close at $51.56 on Thursday, and are up 12 percent this quarter.
Brent for November settlement, which expires Friday, was up 0.1 percent, or 5 cents, at $57.46 a barrel on the London-based ICE Futures Europe exchange. Prices are up almost 10 percent this month and 20 percent this quarter. The global benchmark crude traded at a premium of $5.89 to WTI.
© 2017 Bloomberg L.P.