Russia Agrees To Talk With OPEC

Russian crude oil output rose to a post-Soviet record last month as producers took advantage of the weak Ruble to push ahead with drilling. The nation’s production of Crude rose to 10.74-M BPD, 1%more than a year earlier and topping the record set in June, according to data from the Energy Ministry’s. Russia, one of the world’s top three oil producers, said it was prepared to meet OPEC and non-OPEC oil producers to discuss the market if such a meeting is called. A separate meeting between Russian and Saudi officials was being planned for the end of October, Russian Energy Minister Alexander Novak has said.

Moscow had been unwilling in the past to cut its oil output to support prices. Last November, it declined to cooperate with the Organization of the Petroleum Exporting Countries to defend market share.

Saudi Arabia cut pricing for November oil sales to Asia and the U.S. as the world’s largest crude exporter seeks to keep its barrels competitive with rival suppliers amid sluggish demand.

Saudi Arabian Oil Co. reduced its official selling price to Asia next month to a discount of $3.20 a barrel below the regional benchmark, compared with a $1.30 discount for October sales, the company said. The discount for the Medium grade to Asia, the main market for Saudi crude, widened by the most since the state-owned company made a $2 a barrel cut in February 2012, according to data compiled by Bloomberg.

Brent crude tumbled almost 50 percent last year as Saudi Arabia and other OPEC members chose to protect market share instead of decreasing output to boost prices. Brent fell from more than $100 a barrel in July 2014 to less than half that amount six months later and traded below $50 a barrel on average in September. Contracts were 40 cents higher at $48.53 a barrel on Monday. Meanwhile, West Texas Intermediate crude prices for November delivery advanced 11 cents to $45.65.

Analysts said the rise in crude oil futures was largely in tune with the firming trend in Asian trade where it extends gain as a decline in US drilling pointed to a slowdown in production, but concerns over demand remain after a disappointing US jobs report.

A report from Baker Hughes said the number of active rigs in the United States fell 26 to 614 last week, the lowest in five years, helping ease concerns over the global crude oversupply that has depressed prices.

Despite Monday’s rally, some analysts braced for renewed pressure on oil prices from U.S. government data this week that could show further builds in crude inventories.

Market data from Genscape showed a modest drop about 150,000 barrels on the week for inventories at the Cushing, Oklahoma storage hub for U.S. crude, traders who saw the data said. That sparked concern among some that there would be builds instead of draws in Cushing when the U.S. Energy Information Administration reports weekly storage data on Wednesday. The EIA said U.S. oil stockpiles in total rose nearly 4 million barrels the week ending Sept. 25.