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Oil found support on Monday after Saudi Arabia’s energy minister Khalid Al Falih said he expected the Opec-led production cut deal to be extended past the first half this year to all of 2017.
“Based on consultations that I’ve had with participating members, I am confident the agreement will be extended into the second half of the year,” said Mr Al-Falih during an industry event in Kuala Lumpur on Monday.
Weaker demand during the seasonal maintenance period for refineries and production growth outside of Opec, particularly in the US, has kept a ceiling on prices, he said.
This has put pressure on Opec, and other countries outside of the cartel such as Russia, to extend the six month agreement reached at the end of 2016 to cut 1.8m barrels a day.
Brent, the international benchmark, is 0.6 per cent higher on the day at $49.37 per barrel. US marker West Texas Intermediate is up 0.5 per cent at $46.44.