London - Oil headed for its longest run of gains this
year as Libya’s biggest oil field suffered another outage while Russia signalled
it’s weighing an extension of OPEC-led production cuts.
Futures gained for a fifth day in New York after
advancing 3.2 percent last week following a US military strike on Syria.
Libya’s Sharara field halted just one week after reopening, with the National
Oil Corpopration declaring force majeure on exports, according to a copy of its
decree obtained by Bloomberg.
In Russia, Energy Minister Alexander Novak said
Friday his ministry had been in talks with oil companies regarding the need to
prolong the six-month deal with OPEC.
Support from some members of the Organization of
Petroleum Exporting Countries to extend the curbs has sparked a rally above $50
a barrel.
The cuts have stabilised the market and Russia will continue to watch
inventory levels, but it’s too early to decide whether the pact should be
prolonged, Novak said.
In OPEC nation Libya - exempt from the agreement -
Sharara had been pumping 200 000 barrels a day before the latest disruption,
according to the NOC. A week earlier, exports were interrupted by a pipeline
halt.
“Libyan production is back to square one,” said Giovanni
Staunovo, an analyst at UBS Group in Zurich.
West Texas Intermediate for May delivery rose as much as
58 cents to $52.82 a barrel on the New York Mercantile Exchange and was at
$52.75 as of 12:48 p.m. London time. Total volume traded was about 5 percent
above the 100-day average. The contract gained 54 cents to $52.24 on Friday.
Brent for June settlement climbed as much as 63 cents, or
1.1 percent, to $55.87 a barrel on the London-based ICE Futures Europe exchange
after advancing 35 cents on Friday. The global benchmark crude was at a premium
of $2.65 to June WTI.
Russia, which pledged to trim output by as much as 300 000
barrels a day by the end of this month, will make a decision on prolonging the
curbs after “monitoring results in April and May,” according to Deputy Prime
Minister Arkady Dvorkovich.
Cuts so far haven’t delivered the expected price
boost, he said at an Energy Ministry conference in Moscow on Friday. While the
nation isn’t a member of OPEC, Russia and 10 other countries joined the group
in cutting output from January.