Global oil prices jumped in mid-day London trading after Russia's President Vladimr Putin said it was possible to extend the current program of OPEC cuts to the end of next year.
Speaking as part of the Russia Energy Week Forum in Moscow, Putin said the agreement between OPEC and some of allies, including Russia, which is currently taking 1.8 million barrels of oil from the market each day, should last until at least December 2018 if any extension is agreed. The current agreement is set to expire in March.
Earlier Wednesday, Iran's Oil Minister Bijan Zanganeh told Reuters that an extension "depends on collective decision and consensus within OPEC, but I think there is no objection against this proposal."
The comments lifted the price of Brent crude futures contracts for December delivery, the global benchmark, to $55.80 each, still below yesterday's closing levels in New York but higher on the lows of the London session. West Texas Intermediate crude futures were seen around 23 cents higher per barrel at $50.23 each.
Oil prices have been falling sharply for the past two days amid speculation that U.S. production rates, which were slowed by Hurricane Harvey in early September, will accelerate quickly now that Gulf of Mexico facilities are coming back online.
Last week, oilfield services company Baker Hughes (BHI) said U.S. producers added rigs in the Gulf for the first time in seven weeks, taking its well-watch count of installations to 750 for the week ending on September 29 - a figure that dwarfs the 425 tally recorded over the same week a year ago.
Prices were also pressured by data from Iraq's Oil Ministry, which showed September crude exports rising to an average of 3.24 million barrels per day, which it sold at an average price of $50.23 per barrel.
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