Oil prices narrowly higher as producers discuss extending output pact

By Fanny Potkin

London (Reuters) - Oil prices were marginally firmer on Friday, as the market waited to see whether major producers meeting in Vienna would back an extension to output cuts beyond March next year.

Brent crude futures were up 4 cents at $56.47 a barrel at 1008 GMT.

U.S. West Texas Intermediate (WTI) crude futures were down 2 cents, at $50.53 per barrel.

Some ministers from the Organization of the Petroleum Exporting Countries (OPEC) and from other producers led by Russia are set to discuss a possible extension to the current agreement under which producers are cutting output by 1.8 million barrels per day (bpd) until March 2018.

They are also expected to discuss the monitoring of exports to assess compliance with the deal.

OPEC Secretary-General Mohammad Barkindo said at the opening session of the meeting that all factors in the oil market pointed to headwinds ahead for shale oil producers.

Russian Energy Minister Alexander Novak said on Friday that OPEC and the other producers needed to continue coordinated action and work on a strategy from April 2018.

However, Goldman Sachs said that the talks in Vienna were "noteworthy but premature", adding "we believe it is unlikely that the committee will recommend extension of cuts this week."

Despite the current output restraints increasing U.S. oil production has curbed price gains.

Hurricanes in the Gulf of Mexico have also pushed up crude oil stocks as some U.S. refineries have been shut by flooding.

The Energy Information Administration (EIA) on Wednesday reported that U.S. crude production rose to 9.51 million bpd in the week ended Sept.15 from 8.78 million bpd a week earlier.

Commerzbank said in a note that oil prices were also finding support from the impending tensions around the independence referendum that will be held on Monday in Iraq's semi-autonomous Kurdish region.

(Reporting by Fanny Potkin in London and Jane Chung in Seoul; Editing by Jason Neely, Greg Mahlich)