Brent crude prices held at about 50 dollars a barrel on Friday as sign that the oil market was moving back to more balanced supply and demand.
It was also believed that just-concluded meeting of the Organisation of Petroleum Exporting Countries (OPEC) contributed in shoring up the commodity’s price.
“The worst was over. The market is heading towards rebalancing,” Qatari Energy Minister, Mohammed Al-Sada, told reporters in Moscow.
The positive tone of OPEC at the meeting in Vienna assuaged concerns over an intensified battle for market share between rivals Saudi Arabia and Iran.
“The meeting removed a substantial concern and downside risk from the market as Saudi Arabia made it very clear that they have no intention of swamping the market with oil.
“This means Saudi Arabia is hurting Iran economically through a lower oil price,” said Bjarne Schieldrop, Chief Commodities Analyst with SEB Bank in Oslo.
Supply disruptions elsewhere, particularly in Nigeria, Venezuela, Libya and the United States, were also hastening a return to balance.
On Friday, militants in the restive Niger Delta region that accounts for more than half of Nigeria’s oil production claimed three new attacks on oil infrastructure.
Brent crude futures LCOc1 were trading at 50.09 dollars per barrel, up 5 cents from the last settlement and almost double January lows and on track for its fourth weekly gain.
U.S. West Texas Intermediate (WTI) crude futures CLc1 were up by 3 cents at 49.20 dollars.
Bank of America Merrill Lynch also said that “seasonal dynamics, as well as robust trend gasoline consumption growth in the U.S., India, and even China” was supportive.
Fuelled by lower oil prices, consumers are driving and flying more, boosting consumption of gasoline and jet fuel.
Data from the U.S. Energy Information Administration on Thursday showed larger-than-expected drops in stocks of gasoline and distillates, pointing to strong consumption and exports.