Traders said crude prices were well supported as output cuts led by the Organization of the Petroleum Exporting Countries (OPEC) and Russian Federation have contributed to a reduction in excess supply that had dogged markets since 2014.
Overnight, crude oil prices settled higher on Monday, as investors weighed the prospect of supply disruptions amid rising Middle East tensions while growing expectations of a ramp up in output capped upside momentum.
Despite the cautious sentiment, traders said oil prices were unlikely to fall far, largely due to supply restrictions led by the Organization of the Petroleum Exporting Countries and Russian Federation, which have helped reduce excess stockpiles.
The exporters reached the deal last December and have already extended the agreement through March 2018.
Reuters reported last month, citing OPEC sources, that producers were leaning towards prolonging the agreement until the end of 2018, though the decision could be postponed until early next year depending on the market. Speaking at an energy industry conference, Barkindo emphasised he was confident that both the oil industry and the global economy were benefitting from the deal to cut output among the major producers.
Mazroui, whose country next year holds the rotating OPEC presidency, said that while the UAE backed an extension, he could not say yet whether it would support maintaining the supply cut until the end of 2018.
Opec raised estimates for the amount of crude it will need to pump to meet demand next year by 400,000 barrels a day to 33.4 million a day, according to a monthly report yesterday from the group.
Meanwhile, with $2.39 rise from its preceding week, Organization of Petroleum Exporting Countries (OPEC)'s basket price stood at $58.73 per barrel in the said week.
Morse's remarks came just hours after Opec Secretary-General Mohammad Barkindo gave assurances in Abu Dhabi that the worldwide oil market is re-balancing at a quickening pace and production cuts are the "only viable option" to restore stability.
So far in 2017, Brent has averaged at $54.5 per barrel.
Investors increasingly opted not to bet on higher oil prices, following a report from the International Energy Agency showing it expects rising U.S. shale oil and gas production to at least be among the biggest gains in the history of the industry. U.S. West Texas Intermediate (WTI) crude was at $56.78 per barrel, up 4 cents.
Bahrain said over the weekend that an explosion which caused a fire at its main oil pipeline on Friday was caused by sabotage, linking the attack to Iran, which denied any role in the incident.