Oct. 22 (UPI) -- Crude oil prices were up early on Monday on concerns about potential supply disruptions, but turned lower after Saudi Arabia confirmed it has increased supplies on the market.
Brent crude oil prices for January delivery were nearly unchanged as of 9:03 a.m. EST time at $79.69 per barrel, down 0.1 percent. Meantime, WTI prices for December delivery were trading at $69.08 as of 9.03 a.m. EST, or down 0.3 percent from the opening, EST time.
Saudi Arabian Energy Minister Khalid Al-Falih said in an interview with Russian news agency Tass that the Kingdom has increased production from about 9.9 million barrels per day to 10.7 million barrels per day currently.
Al-Falih said the December 7 meeting in Vienna between OPEC members, as well as non-members working with the consortium, will allow them to "intervene to rebalance the market in any appropriate time from January onward," including an emphasis on Russia's role in helping to balance the market.
"Total non-OPEC participation is 20 million barrels per day, but Russia's alone gives 11 million barrels per day. So obviously Russia is a heavy weight both in terms of production and in terms of political influence," al-Falih said.
Phil Flynn, analyst at The Price Futures Group, wrote in a report late last week that he was seeing a correction in recent days but that "fundamentals still point toward $80/barrel oil plus by the end of the year."
Flynn said he doubts Saudi Arabia can increase production enough in a context where the world is likely to see supply disruptions. Market participants have shown concern in the past about how production from Iran would be replaced once U.S. sanctions against the country go into effect in early November. The sanctions aim at preventing the country from continuing oil exports.
"The Saudi's have not been able to pump much more than 10 million barrels a day consistently and there are reports that their oil inventories are draining," Flynn wrote, adding that Saudi oil stocks are at their lowest level in at least three years.
Reports that a journalist was killed in the Saudi Arabian consulate in Turkey earlier this month have also led to concerns that there could be sanctions announced against the country, which could impact crude oil supplies.