Brent and U.S. crude futures edged lower on Monday as the dollar regained ground and as weak Chinese trade data stoked concerns about demand in the world’s biggest energy consumer.
But the market held most of its gains of more than 10 percent from Friday that came amid renewed talk that the Organization of the Petroleum Exporting Countries (OPEC) might finally agree to cut output to reduce a world glut.
Both benchmarks jumped more than $3 a barrel on Friday after the United Arab Emirates’ energy minister was quoted as saying that OPEC members are ready to cooperate on curbing production.
The mood inside OPEC is shifting from mistrust to a growing consensus that a decision must be reached on how to end the global oil price rout, Nigeria’s oil minister said, adding he will have talks with his Saudi and Qatari counterparts.
“The lower the price, the greater the incentive for output cuts for producers,” said Kaname Gokon at Okato Shoji in Tokyo.
But many analysts, including the International Energy Agency, are skeptical OPEC would cut a deal with other producers to reign in ballooning output.
“We continue to believe that if prices were to be artificially supported with production cuts; it would only give more expensive forms of production more room to breathe and would only solve the problem in the short term,” Phillip Futures said in a note.
China’s exports fell 11.2 percent in January from a year earlier and imports tumbled 18.8 percent, both far worse than expected. China’s crude imports dropped 20 percent from record high the previous month.
Brent crude for April delivery LCOc1 was down 7 cents at $33.29 a barrel by 0730 GMT (2:30 a.m. ET). NYMEX crude CLc1 was down 13 cents at $29.31 a barrel, but still 11 percent above Thursday’s 12-year low. Trade may be thinner than usual due to the U.S. Presidents Day holiday.
Iran is exporting 1.3 million barrels per day (bpd) of crude oil, and will be pumping 1.5 million bpd by the start of the next Iranian year on March 20, a vice-president was quoted as saying on Saturday.
Iran will load 4 million barrels of crude oil on tankers destined for Europe in the coming 24 hours, a senior official was quoted as saying.
Japan’s economy contracted an annualized 1.4 percent in the final quarter of last year, data showed on Monday.