Oil prices rose sharply after an early decline on concerns related to the growth of production in some world regions. In the market fear that oversupply may persist for longer than previously expected.

Oil prices in the US fell earlier after reports that Iraq could increase exports and Nigerian rebel attacks on oil facilities may become loose after the armistice.

In addition, investors are watching the US oil companies, which increased the number of active drilling rigs for eight consecutive weeks, according to a weekly evaluation of oil production in the US in the week of August 6-12. Some analysts warn that the recent rally may lead to a subsequent drop in prices, as it helps to increase production on the background of the continuing oversupply.

"Many analysts believe that the recent rise in prices to $ 50 a barrel was too soon," - noted Mansfield Oil Co. "It is also possible that the excess supply in the global oil market will increase in view of Iraq's plans to increase exports, as well as in view of a possible truce in Nigeria", - added the company.

As noted by Goldman Sachs Group Inc., the price of oil up to the next summer, probably will stay in the range of 45-50 dollars per barrel.

"Recovery in oil prices is unstable," - noted Goldman. Last year, the bank's analysts predicted that oil will fall in price to $ 20, and then recovered. In February this year, the price of WTI crude oil fell to a minimum of 26.21 dollars per barrel.

"Sustainable production recovery after disruptions in some countries force us to lower forecasts", - added Goldman.

On Wednesday, the Energy Information Administration will publish a new weekly report on oil production and reserves.

In September, OPEC countries intend to hold an informal meeting to discuss the possibility of an agreement on the limitation of production, but analysts doubt the likelihood of such an agreement.

The cost of the October futures for WTI rose to 48.32 dollars per barrel.

October futures for Brent crude rose to 50.21 dollars a barrel on the London Stock Exchange ICE Futures Europe.

Gold is moderately higher, as market attention shifted from the Fed officials statements about the benefits of a rate hike to the meeting between the leaders of the world's central banks, this friday at Jackson Hole.

"The gold market have taken into account comments by Fed officials, but the sale was not strong, it is a good response," - said Standard Bank analyst, Tom Kendall.

On Friday, market participants will focus on the speech by the Federal Reserve Chairman Janet Yellen at the annual meeting of leading bankers and economists, in the search for fresh signals on the timing of the next interest rate increase in the United States. Fed's annual symposium is sometimes used for important political statements.

On Monday, the precious metal fell to a two-week low of $ 1,335.40 as the US currency strengthened against the background of "hawkish" comments from several representatives of the central bank.

According to the federal funds futures the odds are 18% compared to only 12% at the beginning of last week for a hike in September and 50% in December.

The dollar fell 0.2 percent against a basket of major currencies.

"The environment for gold is still favorable, as the US dollar index was lower and lower," - said Kendall from Standart Bank.

Stocks of the world's largest gold exchange-traded fund SPDR Gold Trust rose by 0.25 percent to 958.37 tons.

The cost of the October futures on COMEX rose to $ 1,344.90 an ounce.

This morning, New York crude oil futures for WTI fell by -0.78% to $ 47.04 and Brent oil futures were down -0.51% to $ 48.92 per barrel. Goldman Sachs said that market glut will remain and the proposed version of the production freeze at the current record levels, will not help solve the problem. According to experts, the fall in prices was the result of the excessive rally in August, during which prices have risen more than 20 percent.

(raw materials / closing price /% change)

Oil 47.39 -0.04%

Gold 1,343.10 -0.02%