OPEC courting more oil producers to restore stability; may benefit India

Oil prices rise amid OPEC monthly report

This comes as OPEC forecasts higher demand for its oil in 2018 and its production-cutting deal with rival producers was clearing the glut after more than three years of excess.

Oil prices were steady on Tuesday as OPEC said there were clear signs the market was rebalancing and as USA production remained offline following Hurricane Nate, APA reports quoting Reuters. "Between the first half and second half this year, demand growth is nearly about 2 million barrels (per day), which is very robust", he said. But, the oil group soon moved to curb production-along with other oil producing nations-in late 2016.

The figures mean Opec has complied 98 per cent with the cutback pledge, according to a Reuters calculation, up from 83 per cent initially reported in August as the September rise was led by Nigeria and Libya which are exempt from the cut.

Oil prices have firmed in 2017, but they have not risen as much as some analysts had forecast. Should Opec keep pumping at similar levels to September, the market could move into a deficit next year, the report indicates.

"The news that Saudi Aramco is set to make its deepest customer allocation cuts to crude oil in its history shows once again how committed Saudi Arabia is towards reducing the ongoing oversupply of oil in the market", Ahmad said.

"Although the motive behind the Saudi King visiting Moscow would not have been purely to discuss oil, the combination of the visit with the announcement of further production cuts does help improve sentiment ahead of the upcoming OPEC meeting on 30 November", Ahmad added.

OPEC's reluctance to cut output was also seen as a key reason behind the fall.

"A rise above that level would encourage United States oil producers to expand their drilling activities, otherwise the lower prices could lead to a reduction" in investments, it added.

"Oil prices are expected to remain at $50-55/b in the next year", Opec said.

Brent crude futures LCOc1 were trading down 14 cents, or 0.3 percent, to $56.47 per barrel by 12:32 p.m. EDT (1232 GMT). The main USA contract, WTI, was at $51.30.