Crude futures rose on Thursday after Iran’s oil minister endorsed the agreement brokered by Russia and Saudi Arabia to freeze production at their January levels.
It remains unclear, however, if the move would lead to any output cuts as Tehran didn’t categorically say if it would scale down production.
As oil prices soared in the previous session by as much as 8%, analysts warned that markets are overreacting to Iran’s statement of support for the production freeze, adding the deal would likely not make significant dents in the supply surplus.
Nonetheless, Brent futures rose $0.21 to $34.71 a barrel by 0740 GMT, after hitting an intraday high of $34.99 in the previous session.
U.S. crude gained $0.54 to $31.20 a barrel, after peaking at $31.49 the day before.
Iran’s Oil Minister Bijan Zanganeh met with his counterparts from Iraq, Qatar and Venezuela on Wednesday but did not say if his country would cut back its crude output.
Iran was exporting approximately 2.5 million barrels per day (bpd) before sanctions were imposed by world powers in response to Tehran’s controversial nuclear program. The punitive move cut the country’s global oil shipments to 1.1 million bpd.
The nuclear-related sanctions were lifted last month, allowing Iran to resume exports. The Islamic country has since indicated that it intends to raise crude production to pre-sanction levels.