Oil steady near two-year highs, U.S. supply increase caps rise

Iranian light crude breaks $60 mark

On the supply side, tensions in the Middle East raised the prospects of disruptions, traders said, adding it was unclear whether a strong quake that hit Iran and Iraq on Sunday had impacted the region's oil production.

Last week, Brent rose to $64.65, its highest since June 2015, and WTI hit $57.92, its highest since July 2015. For traders, "it's logical to do the extension", he said.

"I am optimistic about the whole of 2018", which will be a "recovery year" for oil markets, he said in a speech at the Abu Dhabi conference.

Regional concerns in the Middle East include the war in Yemen and growing tensions between Saudi Arabia and Iran.

Additionally, traders said it was unclear whether a strong quake that hit Iran and Iraq on Sunday had affected the region's oil production.

In the 12 months between November 2016 and November 2017, several things that used to be just suspicions or suggestions became evident: that OPEC is no longer the master of oil markets, capable of swinging prices higher or lower whenever it fancied; that USA shale is here to stay and grow; and that, were it not for demand growth and the latest developments in the Middle East, Brent would never have returned to $60 a barrel exclusively as a result of OPEC's production cut efforts.

Bahrain said at the weekend that an explosion that caused a fire at its main oil pipeline on Friday was caused by sabotage, linking the attack to Iran, which denied any role. The output has grown over 14 percent since the middle of 2016, reaching a record 9.62 million barrels per day.

OPEC and other non-OPEC producers will meet on November 30 in Vienna to decide on oil output policy.

United Arab Emirates' minister for energy Suhail al-Mazroui has stated that he expects the Organisation of Petroleum Exporting Countries (OPEC) and non-OPEC countries to extend global supply cuts at the November 30, 2017 meeting.

OPEC has sought to push stocks to the five-year average. That maintained the highest level since mid-April.

The IEA said warmer temperatures could reduce consumption, while sharply rising output from outside the producer group OPEC might mean the global market tilts back into surplus in the first half of 2018. He also said a decision would hopefully be made soon on the location for the listing of shares in the oil giant.

U.S. producers added nine oil rigs last week, the biggest jump since June, raising the count to 738, energy services firm Baker Hughes said on Friday. Currently, RSI on daily chart is above 60 levels indicating high momentum in prices.

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