Iranian Oil Minister Bijan Zanganeh says the right to increase crude oil production in a post-sanctions era is non-negotiable. Crude oil prices surge in Thursday trading amid heavy market volatility. UPI/Maryam Rahmanian | License Photo
WASHINGTON, Dec. 3 (UPI) -- Steady growth expectations for Asia and OPEC anticipation offset European trajectory, giving crude oil prices a major lift after Wednesday's sell off.
Brent crude oil prices surged 2.5 percent in early Thursday trading to $43.56 after suffering heaving losses during the previous session. West Texas Intermediate, the U.S. benchmark price for crude oil, rallied 3 percent to $40.64 following a drop below the $40 threshold in trading Wednesday.
A string of economic statements from financial regulators and expectations about future production from the Organization of Petroleum Exporting Countries are sparking volatility in energy markets this week. Despite wild swings, the price for Brent crude oil is down about half a percent from Monday.
OPEC ministers arrived in Vienna this week for a regular meeting Friday. A late 2014 decision to maintain steady production added durability to the bear market for crude oil. This year, production dynamics are influenced heavily by the expected return of Iranian crude oil and the re-introduction to OPEC of Indonesia, which still relies heavily on imported oil.
A report Thursday from Energy Intelligence said OPEC would agree to a production cut by 1 million barrels per day provided non-member states like Russia and members Iraq and Iran agree.
Speaking from Vienna, Iranian Oil Minister Bijan Zangeneh said the Islamic republic is entitled to work to capitalize a stronger position in the post-sanctions era.
"Limiting our level of production is not negotiable," he said.
On the economic front, a report from the Asia Development Bank forecasts regional economies will grow by a collective 5.8 percent for 2015 and 6 percent for 2016, despite concerns about a slowdown in China.
"Although we have seen some softening in a number of economies, the broader regional outlook is for continued steady growth," ADB Chief Economist Shang-Jin Wei said in a statement.
Saudi Arabia has said it needs to keep its output steady to meet expected demand from Asia.
Meanwhile, Eurostat, the statistical office for the European Union, reported euro area inflation at 0.1 percent for November, stable when compared with the previous month. President of the European Central Bank Mario Draghi said latest projections indicate there will be downward pressures on regional inflation and rates would therefore remain stable.
"The interest rate on the main refinancing operations and the interest rate on the marginal lending facility will remain unchanged at 0.05 percent and 0.30 percent respectively," the bank said.
In the United States, the Labor Department reported an increase of 9,000 for the seasonal adjusted initial claims for unemployment protection for the week ending Nov. 28.