Oil edges up as producer meet overshadows U.S. stockbuild

Wed Mar 2, 2016 4:54pm EST
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By Barani Krishnan

NEW YORK (Reuters) - Oil prices ended up for a third straight day on Wednesday as buyers shrugged off record high U.S. crude stockpiles to focus on an OPEC plan to freeze production, keeping alive the notion that market has bottomed from a near two-year selloff.

OPEC member Venezuela said a total of 15 oil producing countries will attend a meeting planned later this month on freezing output at January's highs.

Diplomatic activity between the Organization of the Petroleum Exporting Countries and other major producers to address the supply glut by freezing output has helped feed a 25 percent price gain in the last 2-1/2 weeks from 12-year lows.

Oil prices briefly dipped on U.S. government data that showed crude stockpiles at record highs for the third consecutive week after rising 10.4 million barrels to 518 million barrels last week. [EIA/S]

Brent futures LCOc1 settled up 12 cents at $36.93 a barrel. They have risen more than $1.80, or 5 percent, since Friday's close.

U.S. crude's West Texas Intermediate (WTI) futures CLc1 finished up 26 cents at $34.66 a barrel. Only in mid-February, WTI fell to a 2003 low of $26.05.

"It seems more likely that $26 is in the rear view mirror at the moment," Anthony Headrick, energy market analyst at CHS Hedging, a commodities broker in Saint Paul, Minnesota, said.

"Fundamentals remain bearish but prospects of OPEC freeze and downward cycle in U.S. output will likely limit a retest of the recent lows."   Continued...

A worker checks the valve of an oil pipe at the Lukoil company owned Imilorskoye oil field outside the West Siberian city of Kogalym, Russia, January 25, 2016. REUTERS/Sergei Karpukhin