Oil prices jumped amid renewed speculation that OPEC would try to restrain output.
SINGAPORE: Oil prices edged up on Monday, after a 2% slide on Friday, as the number of rigs drilling for new oil in the United States dipped and on expectations that Saudi Arabia would continue to restrain its output to support the market.
Meanwhile, oil ports, producers and refiners in Louisiana, Mississippi and Alabama - which shut facilities ahead of Hurricane Nate - were planning to reopen on Monday as the storm moved inland, away from most energy infrastructure on the US Gulf Coast.
US West Texas Intermediate (WTI) front-month crude futures were trading at US$49.44 per barrel at 0634 GMT, up 15 cents, or 0.3%, from their last close.
Brent crude futures, the international benchmark for oil prices, were up 17 cents, or 0.3%, at US$55.79 a barrel.
Oil tumbled by around 2% on Friday, with WTI dipping back below US$50 per barrel, as concerns of overproduction re-surfaced.
Traders said a reported cut in the number of US oil rigs drilling for new production had halted the price fall.
The US rig count fell by two to 748 in the week to Oct 6, General Electric Co’s Baker Hughes energy services firm said in its closely followed report on Friday.
Trading activity was low on Monday due to the Columbus Day holiday in the United States, although markets there are open.
As a sign of more positive sentiment in the market, hedge funds and money managers raised their bullish bets on US crude futures for the third week in a row, the US Commodity Futures Trading Commission reported on Friday.
The institutional investors raised their combined futures and options position in WTI on the NYMEX and ICE markets by 3,211 contracts to 288,766 in the week to Oct 3, its highest since mid-August, the data showed.
Analysts also said a Saudi Arabian commitment to support the market by restraining output would likely prevent crude from falling further.
“We remain fairly confident that the Saudi’s will look to continue to support the oil market, especially until the sale of Aramco,” said Shane Channel, equity and derivatives adviser at ASR Wealth Advisers.
State-owned oil giant Saudi Aramco is planning to float around 5% of the firm in an initial public offering next year. - Reuters
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