* OPEC meeting in Vienna does not agree output targets
* Saudi restraint seen as market supportive
* High output offset by supply disruptions in Nigeria, elsewhere
* Strong demand for diesel, jet fuel and gasoline (Updates prices, adds non-farm payroll)
By Libby George
LONDON, June 3 (Reuters) – Brent crude prices held around $50 a barrel on Friday on signs the market was moving back to more balanced supply and demand, and on an OPEC meeting viewed as supportive.
“The worst was over,” Qatari energy minister Mohammed Al-Sada told reporters in Moscow. “The market is heading towards rebalancing.”
The positive tone of the Organization of the Petroleum Exporting Countries (OPEC) meeting in Vienna on Thursday assuaged concerns over an intensified battle for market share between rivals Saudi Arabia and Iran.
“The meeting removed a substantial concern and downside risk from the market as Saudi Arabia made it very clear that they have no intention of swamping the market with oil as a means of hurting Iran economically through a lower oil price,” said Bjarne Schieldrop, chief commodities analyst with SEB Bank in Oslo.
Supply disruptions elsewhere – particularly in Nigeria, Venezuela, Libya and the United States – were also hastening a return to balance. On Friday, militants in the restive Niger Delta region that accounts for more than half of Nigeria’s oil production claimed three new attacks on oil infrastructure.
Brent crude futures were trading at $49.80 per barrel at 1242 GMT, down 20 cents from the last settlement, but still almost double January lows and on track for its fourth weekly gain.
U.S. West Texas Intermediate (WTI) crude futures were down 30 cents at $48.87.
Analysts said the small declines were against the overall trend, which was towards higher prices over the summer.
“We find it difficult to be bearish the crude oil time-structure as long as the Delta Avengers are maintaining their current momentum of supply destruction; this will also support the flat price of crude oil,” said Olivier Jakob, managing director of PetroMatrix.
A decline in the U.S. dollar, which makes oil cheaper for holders of other currencies, could also lend support to oil prices. The drop came after weaker-than-expected U.S. non-farm payroll data.
Bank of America Merrill Lynch also said that “seasonal dynamics, as well as robust trend gasoline consumption growth in the U.S., India, and even China” was supportive.
Fuelled by lower oil prices, consumers are driving and flying more, boosting consumption of gasoline and jet fuel.
Data from the U.S. Energy Information Administration on Thursday showed larger-than-expected drops in stocks of gasoline and distillates, pointing to strong consumption and exports.
Connect via email
- Nigerian officials collect bribes totalling $1.2 billion each year -statistics office – Reuters
- WEEKAHEAD-Nigerian naira is seen weakening on the black market – Reuters
- Naira appreciates to N359.7/$ as External reserve hits $31.35bn – Vanguard
- Asia rally falters as dollar languishes – AFP
- Africa’s Richest Man to Invest Up to $50 Billion in U.S., EU – Bloomberg