Oil strengthens in Asia on prospects of Saudi output freeze

Oil benchmarks ticked higher in Asia after Algeria Energy Minister informed markets that Saudi Arabia is ready to freeze its output at January levels.

At the time of writing, WTI oil was up 0.94% or 42 cents at $44.90/barrel. Brent oil was up 0.86% or 40 cents at $46.88/barrel. “Saudi Arabia is ready to freeze production at the January level,” Boutarfa said. Saudi Arabia pumped a record 10.69 million barrels a day in August compared with 10.2 million in January.

Algerian Energy Minister Noureddine Boutarfa’s comments pushed up oil prices but that does not change the fact that Saudi production freeze is contingent on Iran agreeing to freeze its output. Hence, the rise in oil prices seen in Asia could proved to be short lived.