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As supply cuts are reversed, OPEC's crude oil production in August (excluding Congo, which joined OPEC in June) rose to a 10-month high. The oil prices are skyrocketing in India and the consumers are not likely to get any relief any time soon as the danger of the U.S. sanction looms.

On the flip side, the bearish breakout of $68.45 can lead oil prices towards $67.45.

At about 11:30 a.m. EDT (1530 GMT) the rally began, with USA crude up over $1 a barrel as both grades moved to end the week higher. The bearish news was concerns over possible lower future demand.

October futures on West Texas Intermediate crude the US benchmark, rose by 49 cents, or 0.7 per cent, to $69.08 a barrel on the New York Mercantile Exchange.

"The pause in shipments probably doesn't mean China will to bow to pressure from U.S. President Donald Trump - Beijing is said to have resisted such curbs - it might indicate that the Asian country's refineries want better terms for Iranian cargoes", the report added.

Brent was set for a 2 percent weekly rise and WTI 1.7 percent.

The contract will be based on the differential of the four crudes to the dated Brent benchmark price and will represent 1,000 barrels of oil.

"The price action of yesterday confirms $80.00 a barrel as a strong resistance line in Brent", consultancy Petromatrix said in a research note.

The International Energy Agency (IEA) said in its monthly Oil Market Report on Thursday that due to falling supply from Venezuela and Iran, the market is tightening.

Iran, a founding member of the cartel, had been against the move which came as the country faces renewed United States sanctions after Washington's decision to leave the 2015 nuclear deal between Tehran and world powers.

It's uncertain whether Saudi Arabia and other producers will fill any shortfall, or how far they're able to do so, the agency said.

China will not buckle to USA demands in any trade negotiations, the major state-run China Daily newspaper said in an editorial on Friday, after Chinese officials welcomed an invitation from Washington for a new round of talks. Then in June and August, U.S. output bypassed Russian Federation for the first time since February 1999. The first row of new sanctions against Iran were put in place in August, while more hard-hitting sanctions against the country's energy sector will take effect on November 4.

Refiners in India, traditionally major buyers of Iranian crude, will cut their monthly loadings from Iran for September and October by almost half from earlier this year.


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