Oil climbed back above $66 a barrel today as the difficulty of restoring Nigerian output shut in by militant unrest and concerns about supplies offset the impact of rising US crude inventories.
US light sweet crude oil futures for May delivery gained 12 cents to $66.28 a barrel, while London Brent crude rose 25 cents to $66.64 a barrel by 10:47am.
"It's a fight between oversupply in the market, building inventories and geopolitical risks," said Michael Lewis, global head of commodity research at Deutsche Bank.
Opec president Edmund Daukoru said markets were well supplied with crude oil, but gasoline supplies could be tightened by refining bottlenecks, especially as peak US driving season approaches.
"OPEC can supply more if more Opec oil is called for," Mr Daukoru, who is also Nigeria's oil minister, told reporters on the sidelines of an African energy conference in Algiers.
"But if the downstream cannot process what we place on the market, it is useless to ask OPEC to produce more."
Supplies from Nigeria, the world's eighth biggest oil exporter, have been cut by more than 500,000 barrels per day for almost two months because of militant attacks.
Industry sources said Royal Dutch Shell and other companies had no plans to return their staff to abandoned oilfields in Nigeria's southern delta until there was a truce with militants.
Oil industry sources also said a meeting between the government and delta groups scheduled for later on Wednesday was unlikely to achieve anything because key players from the militant side would be absent.