Oil prices hit 11-week highs above US$31 a barrel on Friday as OPEC producers Saudi Arabia and Venez-uela sought assurances that non-member Mexico would follow the cartel in any move to tighten supply.
Renewed signs that looting and sabotage will disrupt the resumption of Iraq's oil exports further bolstered prices, which have gained 20 percent in the last month.
US crude futures jumped US$0.46 to US$31.20 a barrel, hitting its highest price since March 19. In London, benchmark Brent crude was US$0.36 higher at US$27.80 a barrel.
Saudi Oil Minister Ali al-Naimi and his Venezuelan counterpart Rafael Ramirez met in Madrid with Mexico's Energy Minister Ernesto Martens ahead of next week's OPEC conference on third-quarter production policy.
"We are coming here before the OPEC meeting to discuss the world oil market. We are also in contact with Russia and Norway and I think we will get good results," Ramirez said.
Saudi Arabia and Venezuela want to lay the groundwork for contributions from non-OPEC producers should the return of Iraq push prices down later this year, officials at the talks said.
"That's the key, because it indicates non-OPEC producers may be willing to cooperate, if nothing else by giving lip service to jawbone the prices higher," said a New York trader.
With oil prices near the top end of OPEC's US$22 to US$28 a barrel band, some ministers have said they see no need for OPEC to cut production limits when it meets next Wednesday in Qatar.
Iraq announced on Thursday it would this month resume oil exports, which have been halted since mid-March. But a full recovery of its pre-war exports -- some 4 percent of globally traded oil -- appears distant.
Baghdad's top US adviser on oil said on Friday that well-organized saboteurs are targeting Iraqi oil facilities in a campaign designed to hamper efforts to revive crude exports as the country recovers from war.
"It is very difficult for me to identify who they are and what their motives are. I can only say their techniques appear to be very professional and aim at causing harm to significant and important installations," Phillip Carroll told reporters in an interview.
Oil markets have now more than reversed losses following US government data on Wednesday showing an unexpected rise in crude and gasoline supplies.
HORMUZ ISSUE: The US president said he expected crude prices to drop at the end of the war, which he called a ‘minor excursion’ that could continue ‘for a little while’ The United Arab Emirates (UAE) and Kuwait started reducing oil production, as the near-closure of the crucial Strait of Hormuz ripples through energy markets and affects global supply. Abu Dhabi National Oil Co (ADNOC) is “managing offshore production levels to address storage requirements,” the company said in a statement, without giving details. Kuwait Petroleum Corp said it was lowering production at its oil fields and refineries after “Iranian threats against safe passage of ships through the Strait of Hormuz.” The war in the Middle East has all but closed Hormuz, the narrow waterway linking the Persian Gulf to the open seas,
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