Investing.com -- Crude futures rose considerably on Thursday, amid renewed efforts by Russia to complete a pact with three OPEC members, including Saudi Arabia, that could help stabilize oil prices from its lowest level since the post-September 11 tragedy.
On the New York Mercantile Exchange, WTI crude for April delivery wavered between $31.09 and $33.47 a barrel before settling at $33.12, up 0.97 or 3.02% on the day. WTI crude staged a late rally in the final minutes of the session to close higher for the third straight session and sixth time in the last eight trading days. In a month rife with extreme volatility, WTI crude is up by approximately 1.65% in February. U.S. crude futures have rallied by more than 15% since touching 13-year lows at $26.05 a barrel on February 11.
On the Intercontinental Exchange, brent crude for April delivery traded between $33.30 and $35.73 a barrel, before closing at $35.30, up 0.90 or 2.59% on the session. North Brent Sea futures have rebounded by more than 10% since dropping below $30 a barrel in mid-February.
Crude moved higher on Thursday following admonitions from Russia energy minister Alexander Novak that prices will remain persistently low unless the four nations involved in last week's meetings in Qatar can finalize the so-called Doha Agreement over the next several days. The deal, which would be the first accord between OPEC and Non-OPEC members in 15 years, would require Russia, Saudi Arabia, Venezuela and Qatar to cap output at their respective January levels.
Novak reiterated on Thursday that Russian monthly production in 2016 will not exceed January's total of 10.84 million barrels per day, which amounted to a post-Soviet record. Furthermore, the Russian energy minister expects talks between the four countries to be completed by early next week.
Oil prices have crashed by more than 70% over the last 20 months, amid a glut of excessive crude on global energy markets as supply continues to greatly outpace demand.
"Offer surplus over demand will decline quicker on account of the demand growth if production is at least not increased, as four of us agreed in Doha, and if the majority of countries do not scale up production," Novak told reporters. "Competition will continue if countries fail to agree upon that. Those capable of increasing will boost (production) further on and the low prices cycle will last longer and may cover 2016, 2017, and so on."
The deal reportedly requires cooperation from Iraq and Iran, two other major OPEC producers in the region. Iran oil minister Bijan Zanganeh reportedly called the production freeze "ridiculous," earlier this week, while blaming his rivals for placing "unrealistic demands," on his country. Iran is expected to ramp up its production and exports by one million bpd this year, following the completion of a historic nuclear deal last month.
"The topic if Iran’s participation is still in the stage of discussion and negotiations," Novak added. "We hear that they are not willing to actually reduce, to freeze the volume of production, given that the base is fairly low in comparison with other producers. That is why an individual and objective assessment is necessary."
Investors also continued to react to reports of a 3.5 million build in U.S. crude stockpiles last week, as top storage facilities nationwide moved even closer to full storage capacity. Analysts expected a sharper increase after a report from the American Petroleum Institute predicted gains of 7.1 million barrels on Tuesday evening. U.S. output, meanwhile, dipped by 33,000 to 9.102 million bpd, moving lower for the fifth consecutive week. U.S. production continues remains far below its June level of 9.5 million bpd when it soared to its highest level in at least 40 years.