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Price maintains deal gains
Crude prices steadied around $50 a barrel on Thursday, holding onto big gains made after Opec and Russia agreed to restrict production, even as analysts warned other producers were likely to top up supply.
Benchmark Brent crude for February was up 20 cents at $52.04 a barrel by 09:50 GMT. On Wednesday, the expired January Brent contract ended up $4.09 or 8.8% at $50.47.
US light crude rose back above $50 briefly before easing to $49.54 a barrel, up 10 cents on the day.
Oil prices initially jumped around 8% and then by a further 3% on Thursday morning following the landmark pact whereby Opec agreed to cut 1.2 million barrels per day of output and non-Opec countries – including Russia - a further 600,000 bpd.
The Opec deal triggered frenzied trading, with Brent futures trading volumes for February and March, when the supply cut will start to be visible in the market, hitting record volumes.
The March 2017 Brent futures contract traded a record 783,000 lots of 1000 barrels each on Wednesday, worth $39 billion and beating a previous record of just over 600,000 reached in September. That is more than eight times daily world crude oil consumption.
Despite the jump in prices, they are still only at September-October levels - when plans for a cut were first announced - and prices are at less than half their mid-2014 levels, when the global glut started.
Opec produces a third of global oil, or around 33.6 million barrels per day, and the deal aims to reduce output by 1.2 million bpd from January 2017, similar to January 2016 levels, when prices fell to 10-year lows amid ballooning oversupply.
Analysts said the cuts would leave the field open for other producers, especially US shale drillers, leading to expectations from Asian oil traders that the price rally would be short-lived.