Futures gained as much as 2.2%, reducing November’s drop to about 8%.
Iran expects no major decisions that would change Opec’s output target when the group gathers on Friday in Vienna, oil minister Bijan Namdar Zanganeh said over the weekend at a conference in Tehran. Speculators increased their bullish position on Brent to a two-week high through November 24.
Oil is set to average below $50 for a fourth month, the longest stretch since the global financial crisis, as a record supply glut showed no signs of ending amid a producers’ fight for market share.
Iran has said it will announce plans during the Vienna meeting to expand output, a year after Saudi Arabia led an OPEC decision to keep pumping and drive out higher-cost shale rivals.
“As the ministers arrive in Vienna the rhetoric will start to fly,” John Kilduff, a partner at Again Capital, a New York-based hedge fund, said. “The market is going to be headline driven and very volatile this week. West Texas Intermediate--WTI--for January delivery rose 64 cents, or 1.5%, to $42.35 in New York.
Prices are down 36% from a year earlier. Brent for January settlement climbed 44 cents, or 1%, to $45.30 a barrel on the London-based ICE Futures Europe exchange. Prices have fallen 8.6% this month. The European benchmark crude was at a $2.95 premium to WTI.
Opec’s resistance to cutting oil output is paying off, according to the International Energy Agency, as US shale drillers idle rigs and major oil companies reduce investment, leaving the 12-member group to fill the gap.
Opec has produced above its own quota of 30 million barrels a day every month since May 2014, data compiled by Bloomberg show.
Crude stockpiles in the US, the world’s biggest oil consumer, have increased to 488.2 million barrels, 120 million above the five-year seasonal average level, according to the Energy Information Administration.
“The supply situation continues to weigh on the market,” Mr Kilduff said. “It’s unrelenting.”
Iran has said it plans to pump an additional 500,000 barrels a day once international sanctions over its nuclear programme are lifted.
That quantity won’t have a significant impact on prices and there will be no problem selling it, Amir Hossein Zamaninia, the deputy oil minister, told reporters on Saturday.