Oil hits nearly three-week high as Saudi Arabia to keep output well below cap

Oil prices extended gains to hit their highest level in nearly three weeks on Monday supported by comments from Saudi Arabia that it would continue to curb exports in line with the OPEC-led-effort to cut global-supplies.

Sweet Brent crude gained 12 cents or 0.2 per cent to 67.43 dollars.

United States West Texas Intermediate crude for April delivery was up 20 cents or 0.3 per cent at 63.75 dollars a barrel.

Prices were increased after Saudi Arabian oil minister Khalid al-Falih on Saturday said that the country’s crude-production in January-March would be well below-output-caps with exports averaging below seven million barrels per day (bpd).

Saudi Arabia hopes OPEC and its allies will be able to relax production curbs next year and create a permanent-framework to stabilise oil markets after the current supply cut-deal ends this year.

U.S. energy companies, last week, added one oil rig, the fifth weekly increase in a row, bringing the total count up to 799, the highest level since April 2015, Baker Hughes energy services firm said on Friday.

Hedge funds and money managers upped their bullish wagers on U.S. crude oil for the first time in four weeks, data showed on Friday.

A powerful 7.5-magnitude earthquake struck Papua New Guinea’s Southern-Highlands-province early on Monday, the U.S. Geological Survey (USGS) said, prompting oil and gas companies to immediately suspend operations in the energy-rich interior.

Meanwhile, Libya’s National Oil Corp said on Saturday it had declared force majeure on the 70,000 bpd El Feel oilfield after a protest by guards closed the field.

Oil price watchers believe oil should in truth climb to 70-100 dollars range.