Oil headed for its best quarter in almost 10 years as the production cuts by Opec and its allies and the loss of barrels due to US sanctions on Iran and Venezuela countered a wobbly demand outlook.

Tullow Oil paid a net $209m (€183m) to various governments in Africa and Europe last year by means of taxes, royalties, production entitlements, licence fees and infrastructure improvements.

Oil prices were largely flat yesterday after steep losses the previous session, with rising US production weighing against comments from leading Gulf oil producers that an extension to Organisation of the Petroleum Exporting (Opec)-led supply cuts was likely.

Oil fell back from one-year highs yesterday on fears that a production cut by the world’s largest exporters might not be enough to erode a two-year old global surplus of unwanted crude oil.