Oil Up as Yemen Missiles Hit Saudi Oil Facilities

 

Yemeni forces have fired ballistic missiles at the facilities belonging to the Saudi state oil giant Aramco in the kingdom's southwest, according to traders citing reports by Iran Press TV and Yemen TV. (http://bit.ly/2bpc5bV)

 

Prices were also supported dollar tumbled against a basket of currencies after U.S. Federal Reserve Chair Janet Yellen's comments at an international gathering of central bankers in Jackson Hole.

 

The dollar index fell 0.5 percent following Yellen's comments, giving a boost to greenback-denominated oil.

 

Brent crude futures rose 66 cents to $50.33 a barrel by 10:36 a.m. EDT (1436 GMT). West Texas Intermediate (WTI) crude rose 72 cents to $48.05 per barrel, a 1.5 percent gain.

 

Prices were pressured early in the session after Saudi energy minister watered down expectations that the world's largest producers might agree next month to limit their output.

 

"We don't believe any significant intervention in the market is necessary other than to allow the forces of supply and demand to do the work for us," Saudi Arabian Energy Minister Khalid Al-Falih told Reuters late on Thursday.

 

Members of the Organization of the Petroleum Exporting Countries will meet on the sidelines of the International Energy Forum, which groups producers and consumers, in Algeria from Sept. 26-28.

 

Iran said on Friday that it would cooperate with other producers to stabilise oil markets, but added that it expected others to respect its individual rights.

 

Many observers interpreted that as Tehran saying it would continue to try to regain market share by raising output after the lifting of sanctions against it last January.

 

"I do not expect the OPEC meeting in September to agree any freeze or affect the oil market in any significant way. This is because it appears key OPEC members remain more concerned about market share," said Oystein Berentsen, managing director for crude at oil trading firm Strong Petroleum in Singapore.

 

Analysts at Commerzbank also expressed doubt that any agreement might materialise next month.

 

"Capping production at this level would hardly reduce supply in any case, especially since other leading OPEC producers such as Iraq are producing at or near record levels," the bank's commodity team said in a note.

 

"And countries like Libya and Nigeria, which are producing significantly below their potential due to unscheduled outages, are hardly likely to sign up to any voluntary restriction of production."