The oil price was higher in Monday trade, on a number of developments supportive of a higher value of the commodity.
Escalating tensions in Iraq around the strategically important city of Kirkuk helped to drive prices higher. Meanwhile, news that US production of oil had slowed and continued OPEC compliance with the output cap, both helped push prices upwards, too.
Brent crude was trading at around $57.80 per barrel, with less than two hours left of the UK trading session. Western Texas Intermediate crude, meanwhile, was at the $52 per barrel level.
Iraq fighting exacerbates oil output concerns
Fighting between Iraqi government forces and Kurdish militants around Kirkuk continued over the weekend. There are a number of oil installations around the city and the ongoing dispute is adding to worries there could be a significant disruption to oil output from the region.
The fighting has already led to a drop in supply of oil from the region. According to Reuters, oil exports from Iraq’s Kurdistan via the Turkish Mediterranean port of Ceyhan, were between 200,000 and 250,000 barrels per day. That’s down from the usual 600,000 barrels per day output.
Iraqi oil minister Jabar al-Luabi said the southern Basra region of the country had increased its oil exports to make up some of that short-fall. Expectations that supply from Iraq could actually decline further, is helping to keep prices supported.
US oil supply slows
A separate report, meanwhile, suggested a third consecutive week of a slowdown in US drilling. The Baker Hughes US oil rig count, said there were 15 fewer rigs drilling for oil in the week ended October 20. That follows declines of 10 and 21 in the two previous weeks.
And, news that OPEC compliance with the oil output cap continues is also helping to keep the supply of oil at a pace that helps keep prices around the $60 per barrel mark the cartel is said to target.
Plans to extend the current supply cap are expected to be discussed and even agreed, at the next OPEC meeting in November.