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Iran`s crude oil traded near $47 per barrel in the week to July 21. increasing more than 6% from the end of last month and reflecting a recovery in the global market.
Iran Heavy. one of the country`s main export grades. settled at $46.12 a barrel in the week. up $1.56. Iran`s light crude settled up $1.12 to reach $46.90 per barrel. IRNA reported on Sunday. citing a report by the Oil Ministry.
The price of OPEC basket of 14 crudes stood at $48.88 a barrel on Thursday. compared with $48.51 the previous day. according to OPEC Secretariat calculations.
The upsurge in Iran`s crude prices mirrors bullish sentiments about the prospect of easing global inventories just days ahead of a meeting between OPEC and non-OPEC members in the Russian city of St. Petersburg.
The Organization of Petroleum Exporting Countries and non-OPEC producers last week discussed extending a deal to cut output by 1.8 million barrels per day beyond March 2018 if necessary.
Saudi Energy Minister Khalid al-Falih said his country would limit its crude exports to 6.6 million bpd in August. almost 1 million bpd below levels of a year ago. Nigeria voluntarily agreed to join the deal by capping or cutting its output from 1.8 million bpd.
Markets welcomed the Saudi cuts and prices ended the week on a high note. Brent crude futures were up $1.01. or 2%. at $52.50 a barrel. rising more than 9% this week. reaching new two-month highs and posting the strongest weekly percentage gains this year.
However. prices have remained locked in a range of $45-55 this year and analysts believe that any bump in prices will embolden non-OPEC producers. including the US shale producers. to raise output and distort the market.
Thirteen OPEC members and 11 other nations. including Russia. decided on May 25 to extend their agreement to reduce daily crude output by 1.8 million barrels per day by nine month to March next year.
OPEC hopes the market rebalancing will accelerate in the second half of this year.
`We are pretty sure that the rebalancing process may be going at a slower pace than earlier projected. but it is on course. It is bound to accelerate in the second half.` OPEC Secretary-General Mohammad Barkindo said last week.
