Oil prices were up as much as 2 per cent on Wednesday after a third surprise weekly drop in US crude stockpiles helped assuage fears over a global oil glut.
Oil prices were also bolstered as a weaker USA dollar lifted investor sentiment, which made the dollar-dominated oil more attractive for holders of other currencies.
West Texas Intermediate for October delivery, which expires Tuesday, gained as much as 88 cents to $43.91/bbl on the New York Mercantile Exchange and was at $43.64 as of 12:16 p.m. London time.
The latest American Petroleum Institute (API) inventories data recorded a substantial draw of 7.5mn barrels in the latest week compared with an expected build of over 2.0mn.
Oil climbed near $45 a barrel after Algeria said OPEC may turn its informal talks next week into a formal session and as weekly industry data showed USA crude inventories declined.
But some analysts said that in the absence of any firm agreement, prices will continue to swing.
"OPEC members will not agree on a production freeze".
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"Even if an agreement to freeze production is reached, this will change very little for the global oil market, given that most Opec members are already producing close to their peak capacity".
Oil prices dipped today with analysts expecting volatility in the run-up to a producers' meeting next week, while traders are also awaiting the release of USA stockpiles data.
Both benchmarks hit six-week lows earlier on the day in volatile trade ahead of the September 26-28 informal talks in Algeria between the Organization of the Petroleum Exporting Countries and other producers on a proposed deal to contain a glut that has weighed on prices for about two years. OPEC ministers can transform the gathering into an extraordinary meeting since they will all be present, Algerian Energy Minister Noureddine Bouterfa said on public radio.
A freeze would be the group's first decision to limit output since OPEC adopted a Saudi-led plan in 2014 allowing members to pump more to protect market share from increased production from the U.S.to Russian Federation. Non-OPEC producer Russian Federation is also attending the forum.
Iran's August crude exports jumped 15 percent from July to more than 2 million barrels per day (bpd), according to a source with knowledge of its tanker loading schedule, closing in on Tehran's pre-sanctions shipment levels of five years ago.
OPEC will hold an informal meeting after the closing session of the International Energy Forum conference in Algiers on the afternoon of September 28, Bouterfa said on public radio.