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Brent Hits $60 Per Barrel Following Saudi Remarks

Brent Hits $60 Per Barrel Following Saudi Remarks

Saturday, 28 October, 2017 - 05:45
Pump jacks pump oil at an oil field on the shores of the Caspian Sea in Baku, Azerbaijan, October 5, 2017. Picture taken October 5, 2017. REUTERS/Grigory Dukor

Oil prices jumped about 2 percent on Friday, with global benchmark Brent crude rising above $60 per barrel, on support from Saudi Crown Prince Sheikh Mohammed bin Salman for extending an OPEC-led deal to rein in output.

The Organization of the Petroleum Exporting Countries, plus Russia and nine other producers, have cut output by about 1.8 million barrels per day (bpd) to get rid of a supply glut. The pact runs to March 2018 and they are considering to extend it.

The Saudi Crown Prince told Reuters this week he was in favor of extending the term of the agreement.

Russian President Vladimir Putin has also made similar remarks.

"OPEC welcomes the clear guidance from the Crown Prince of Saudi Arabia on the need to achieve stable oil markets and sustain it beyond the first quarter of 2018,” OPEC's Secretary General Mohammad Barkindo told Reuters on Friday.

"Together with the statement expressed by President Putin this clears the fog on the way to Vienna on Nov. 30."

Meanwhile, Exxon Mobil Corp (XOM.N), the world’s largest publicly traded oil producer, posted a higher-than-expected quarterly profit on Friday.

“A 50 percent increase in earnings through solid business performance and higher commodity prices is a step forward in our plan to grow profitability,” Darren Woods, Exxon’s chief executive officer, said in a statement.

Third-quarter net income jumped to $3.97 billion, or 93 cents per share, from $2.65 billion, or 63 cents per share, in the year-ago period. Exxon said Hurricane Harvey dented quarterly earnings by 4 cents per share.

Production rose about 2 percent to 3.9 million barrels of oil equivalent per day.

French oil and gas major Total (TOTF.PA) also reported a 29 percent jump in third-quarter net profit as project ramp-ups and new investments lifted production, joining a list of energy companies benefiting from higher crude prices.

“The group took full advantage of the favorable environment thanks to the performance of its integrated model and its strategy to reduce its breakeven point,” Chief Executive Patrick Pouyanne said in a statement.

Also on Friday Eni (ENI.MI) said it swung to a profit in the quarter.

Total’s net adjusted profit for the quarter hit $2.7 billion, in line with the average of forecasts from analysts polled by Reuters.

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