Crude oil markets recovered last week from a three-month low, fueled by speculation that the 14-member Organization of the Petroleum Exporting Countries (OPEC) would come to an agreement on productions cuts, the first since 2008.
That trend continued Monday as Brent crude futures for January delivery opened at $47.01 on the CME Globex, reaching a mid-day high of $48.38 and a low of $47.00. March contracts broke $50, reaching $50.25 after opening $49.46 with a low of $49.46.
But OPEC's November 30 meeting in Vienna will have to deal with those contrarian members that want to open up the spigots wider.
The oil cartel is seeking cuts of between 32.5 million and 33 million barrels a day from record levels of 33.83 million barrels during the third quarter.
Some analysts say supply disruptions among OPEC members such as Nigeria could drive prices up. But Iraq and Iran are asking for exemptions--Iraq because of demands related to the war against ISIS and Iran because it has recently re-entered the market following the decades-long sanctions that were lifted early this year. At a meeting in Doha Friday, a number of OPEC oil ministers indicated that Iran would be given flexibility on production.
Brazil, Canada, Russia and the United States are non-members that are beyond OPEC's control. Russian Energy Minister Alexander Novak, who attended Friday's Doha meeting, said he thought OPEC was moving closer to a deal. If an agreement were reached, Russia was prepared to cap output for six months or longer, Novak said.