OPEC and its allies are scheduled to meet on Sunday in Algeria to discuss how to allocate supply increases to offset a shortage of Iran supplies due to US sanctions.
Sunday's meeting appeared to leave unresolved a disagreement which flared up in June between Saudi Arabia and Iran over whether OPEC members are allowed to pump more oil to make up shortfalls elsewhere.
Futures in London rose as much as 2.7 per cent. OPEC and its partners gave a tepid response to President Donald Trump's demand that rapid action be taken to reduce prices, saying they would boost output only if customers want more cargoes. This report drew criticism from President Trump who called for the cartel and other non-OPEC members to increase production. "We're looking at $68 [average] for this year and $73 for 2019".
Higher prices tend to mean higher petrol costs.
The OPEC cartel in December 2016 concluded an agreement with non-member states - including Russian Federation - to reduce output in order to arrest sliding prices.
Dated Brent could see the biggest overhaul since the North Sea crude became a benchmark more than 30 years ago as S&P Global Platts considers including oil from as far away as Central Asia, West Africa and USA shale fields in its price assessment.
Benchmark Brent oil reached $80 a barrel this month, prompting Trump to call again on the Organization of the Petroleum Exporting Countries to lower prices. That suggests OPEC's power to influence the market will be tempered by US production for about another decade.
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Opec and oil producers outside the group, including Russian Federation , will meet on Sunday to revise oil production quotas. US President Donald Trump took to Twitter on Thursday in an effort to persuade OPEC to increase production and ease prices.
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"I do not influence prices", Saudi Energy Minister Khalid al-Falih told reporters as OPEC and non-OPEC energy ministers gathered in Algiers for a meeting that ended with no formal recommendation for any additional supply boost.
This year the global economy has been expanding strongly, leading to growth in oil consumption and pushing up crude prices.
In addition to USA sanctions cutting Iranian supply, the world is also dealing with a decline in Venezuelan oil production due to an economic crisis in the Latin American nation, according to Trafigura's Luckock.
"The biggest issue is not with the producing countries, it's with the refiners, it's with the demand".
"It's going to be significantly less than it was, and probably lower than most people expected when the sanctions were announced - hence the higher prices", Luckock said at the APPEC event.
"Balances are precarious and the lack of spare capacity could see crude pricing well above US$90 or even US$100, should all of the potential risk in the market materialize", analysts including Ed Morse said in the note.