Oil trades near three-year high as OPEC members reassure on cuts

Futures were little changed in New York after rising 4.7% last week. The production curbs have contributed to stability in the market and should remain, Iraqi Oil Minister Jabbar al-Luaibi said Saturday. Yet Brent crude at $70/bbl may be giving fresh stimulus to U.S. shale-oil drillers to boost output, according to the International Energy Agency.

Oil has extended gains after a second annual advance as the Organization of Petroleum Exporting Countries and its allies reduce supply to drain a global glut. Though they have said their historic deal will run until the end of this year, OPEC is “very likely to cut short” the pact if markets become balanced, JP Morgan Securities said in a report.

“In the next 12 months, we see more or less a balanced market,” Fatih Birol, executive director of the IEA, said in a television interview. “Global oil demand will increase. But a lot of new oil production is coming.”

West Texas Intermediate for February delivery was at $64.38/bbl on the New York Mercantile Exchange, up 8 cents, at 2:33 p.m. London time. Total volume traded was about 45% below the 100-day average. WTI rose 0.8% to $64.30 on Friday, the highest close since December 2014.

Brent for March settlement lost 5 cents to $69.82/bbl on the London-based ICE Futures Europe exchange. Prices climbed 3.3% last week. The global benchmark crude traded at a premium of $5.52 to March WTI.

The UAE sees no big changes in OPEC policy as a result of short-term price fluctuations, Energy Minister Suhail Al Mazrouei said in Abu Dhabi. Qatari Energy Minister Mohammed bin Saleh Al Sada told the official Qatar News Agency that the group should only review its supply accord once crude stockpiles return to their five-year historical average.