Friday, September 20 11:36:49
Oil edged up to $109 a barrel today, supported by the Federal Reserve's decision this week to leave its stimulus programme unchanged, falling U.S. crude inventories and persistent concerns about supplies.
Global benchmark Brent crude was still heading for the biggest weekly decline in three months on the return of some Libyan output, a reduced prospect of military action against Syria and signals from Iran that it is looking for a thaw in relations with the West.
Brent crude for November was up 44 cents to $109.20 by 0846 GMT. The benchmark has fallen about 3.3 percent this week and is on track for its steepest weekly decline since mid-June. U.S. crude for October dropped 20 cents to $106.19.
"The big driver of oil markets in the last day or two has been news that Libya has restored some production capacity," said Ric Spooner, chief market analyst at CMC Markets in Sydney. "Also, the immediate Syrian risk has been unwound."
Libya's production has recovered to 620,000 barrels per day (bpd) after protesters agreed to reopen some oilfields. Output had collapsed to below 200,000 bpd in a stalemate between protesters and the government that lasted more than a month.
It is too early to dismiss the prospect of further disruption in Libya, though.
"Supply tightness seems to be easing but Libya's export recovery is not something that's being assured," said Sijin Cheng, an analyst at Barclays.
World shares steadied at a five-year high on Friday, while bonds and other commodities were consolidating after the Fed's shock decision announced on Wednesday to keep its monetary stimulus intact.
In other developments, Iranian President Hassan Rouhani has sent signals that he is looking for a thaw in relations with the United States. The White House said leaders from both countries may meet next week.
Western sanctions targeting Iran's oil exports over Tehran's nuclear programme have cut Iranian crude shipments by more than half, or more than 1 million bpd, since early 2012.