Oil prices edge higher in thin trade; OPEC eyed

Mon May 30, 2016 4:53pm EDT
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By Nia Williams

(Reuters) - Oil prices inched up toward $50 a barrel on Monday, although uncertainty ahead of an OPEC producer-group meeting later in the week was expected to cap gains.

The Organization of the Petroleum Exporting Countries meets in Vienna on Thursday and most analysts did not expect any changes in the group's production.

While OPEC has been unable to agree on an output freeze to support prices, Iraq was the latest Middle East producer to raise its export quota ahead of the meeting, supplying 5 million barrels of extra crude to its partners in June.

"So far there's pretty much a consensus that nothing will happen and that the same strategies will continue, which are basically produce as much as you want and go for market share," said energy economist James L. Williams of WTRG Economics in Arkansas.

Price moves will be choppy in the run-up to the meeting, Williams added.

Brent crude futures LCOc1 settled up 44 cents at $49.76 a barrel, reversing losses from earlier in the day. There was no settlement in U.S. West Texas Intermediate, or WTI, crude futures CLc1 because of the U.S. Memorial Day holiday, but at 1839 GMT WTI was up 27 cents at $49.60.

Trade was subdued because of public holidays in Britain and the United States, where Memorial Day is seen as the traditional start of U.S. summer driving season.

Vienna-based consultancy JBC Energy said global oil demand rose by 1.5 million barrels per day in January-April. That was stronger than many forecasts and stemmed from strong consumption in the United States, China and India.   Continued...

Pump jacks are seen at the Lukoil company owned Imilorskoye oil field, as the sun sets, outside the West Siberian city of Kogalym, Russia, in this January 25, 2016 file photo.   REUTERS/Sergei Karpukhin/Files