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Oil prices higher on growing interest in production cut

Kuwait's oil minister said he's open to attending April meeting to review market stabilization efforts.

By Daniel J. Graeber
Oil prices higher on growing interest in production cut
Oil prices move back into positive territory on emerging support for talks in Doha among major producers to stabilize a depressed energy market. File photo by Monika Graff/UPI | License Photo

NEW YORK, March 16 (UPI) -- Growing support for a coordinated production agreement to stabilize energy markets lifted crude oil prices Wednesday after two straight days of decline.

Russian officials visited Tehran this week to review a proposal from major oil producers to freeze output at January levels. A reluctant Iran said it would back a coordinated plan, but not until it regains its position in the global market after several years of economic isolation brought on by nuclear-related sanctions.

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Acting Kuwaiti Oil Minister Anas al-Saleh welcomed an invitation extended Wednesday by Qatari Oil Minister Mohammad al-Sada to an April meeting in Doha to consider the production proposal.

Qatar holds the rotating presidency of OPEC and said it backs efforts to coordinate between OPEC and non-OPEC members to ensure oil market stability.

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After falling for two consecutive days, the price for Brent crude oil turned positive, testing $40 per barrel with a 1.5 percent gain to open the trading day at $39.33 per barrel. West Texas Intermediate, the U.S. benchmark price for crude oil, gained 1.4 percent to start the day in New York at $36.87 per barrel.

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Brent crude oil prices surged over $40 per barrel last week on word U.S. oil production was expected to drop off.

Oil prices are down heavily from territory above $100 per barrel two years ago on concerns global economic growth isn't strong enough to take any extra supplies. A review of production from OPEC by energy reporting service Platts from the 13 member states combined to produce 32.3 million barrels per day in February, down about 90,000 bpd from the previous month.

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The decline came even as Iran ramps up production as sanctions pressures ease following last year's nuclear agreement. Platts, in an emailed report, said Iran's increase was balanced by declines from member states Iraq, Libya, Nigeria and the United Arab Emirates.

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