Oil markets were choppy today as traders got jittery ahead of a weekend meeting of Opec and non-Opec producers.
Prices dipped in London afternoon trading after Russian news agency Tass reported the meeting, due to be held this Saturday in Vienna, could be postponed.
However, a Russian energy ministry spokeswoman later said there were no changes to the producers’ plans, giving oil prices an extra boost.
Global benchmark Brent crude was up 1.4 per cent, or $0.72, last night to $53.70, while US sweet crude was up two per cent, or $0.97, to $50.74.
Prices rallied to the highest levels in 18 months after the Organisation for the Petroleum Exporting Countries (Opec) agreed on 30 November to slash production by 1.2m barrels per day (bpd) in the first half of 2017.
However, the rally cooled on Tuesday after data was released showing Opec's and non-Opec member Russia's production rose considerably in November.
Global benchmark Brent crude and US benchmark West Texas Intermediate crude have both lost $2 since Monday.
On Saturday, the cartel will meet with non-Opec countries in Vienna to finalise a global oil limiting pact. Russia has already said it will commit to slashing 300,000 bpd, though other countries will need to contribute to an output trim to properly stem an global supply glut that has weighed on prices since 2014.
Azerbaijan, Mexico, Kazakhstan, Russia and Oman are all expected to be attending the meeting, though producers including Bolivia, Bahrain and Colombia have also been tabled as possible attendees.
Azerbaijan has said it will come to Vienna armed with proposals for its own reduction.
Mihir Kapadia, chief executive of Sun Global Investments, said:
There are big doubts over whether non-members will make the agreed cuts and stick to them. Russia has agreed to a 300,000 barrel production cut comparted with 600,000 proposed by Opec. It will be interesting to see how other non Opec members respond. The question looms over Opec’s willingness to go at it alone. All these are factors will affect oil prices in 2017.