One wild card moving forward could be USA crude oil production

US Distillate Inventories Off 6 Year Seasonal High Again

West Texas Intermediate for December delivery was at US$49.21 a barrel on the New York Mercantile Exchange, up 3 cents, at 8:27am in Hong Kong.

Overnight, oil prices rose after the U.S. Energy Information Administration data showed crude inventories fell 553,000 barrels in the week ended October 21.

Oil prices were depressed earlier in the session by producers' verbal jockeying over planned output cuts by the Organization of the Petroleum Exporting Countries.

The Energy Information Administration said short positions of West Texas Intermediate futures, the United States benchmark, had risen at a faster pace than Brent crude futures, the worldwide benchmark, since the summer of 2015. "Whilst such reduction is largely in the hand of OPEC, the re-balancing is already taking place in the U.S.", Tamas Varga of oil broker PVM said.

Oil edged up on Tuesday ahead of the release of USA crude inventory data, which in recent weeks has provided bullish surprises, but comments by OPEC members regarding chances of an output cut kept a lid on prices. Energy Information Administration data Wednesday is forecast to show supplies rose.

Brent crude futures LCOc1 were trading at $51.59 per barrel at 0133 GMT, down 19 cents, or 0.4 percent, from their last close.

Mr Luaibi then told reporters in Baghdad that Iraq would seek the same exemptions as Iran, Nigeria and Libya - which have had crude output hit by wars and sanctions - emphasising that Baghdad needs its oil income to fight the war on Islamic State.

In September, the group's production reached 33.4 million barrels a day.

US crude futures fell 95 cents to $49.01 after earlier dropping to $48.93, a low since October 4. Members meet in Vienna on November 30. The country is producing more than the 4.7 million barrels a day it pumped in September, he said.

Senior OPEC officials met with Russia's energy minister Sunday as the disjointed cartel aims to hammer out the details of a tentative oil production freeze.

"The current down cycle is nearing an end", said Saudi Oil Minister Khalid al-Falih at a news conference with his Russian counterpart Aleksandr Novak.

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