<div>Oil futures climbed more than $1 a barrel on Monday, after Saudi Arabia raised prices for crude sales to Asia for a second month, signalling better demand in the region.</div><div> </div><div>International benchmark Brent regained ground after tumbling as much as 5 percent on Thursday, when a preliminary nuclear deal was finally reached between world powers and Iran. More Iranian oil could enter global markets if that is followed by a comprehensive deal by June.</div><div> </div><div>But analysts warned a ramp-up in exports could take months and would likely not happen before 2016.</div><div> </div><div>"While clearly a bearish headline, a final deal and full lifting of sanctions still faces a number of obstacles," Morgan Stanley analysts said in a note.</div><div> </div><div>"Even if a final deal is reached, we do not expect any physical market impact before 2016," the analysts said.</div><div> </div><div>Brent crude for May delivery touched a high of $56.06 a barrel and was up 80 cents from Thursday at $55.75 by 0510 GMT. U.S. crude for May delivery was 92 cents higher at $50.06 a barrel, after earlier touching $50.35.</div><div> </div><div>There was no settlement in either Brent or U.S. crude futures on Friday as markets were closed for the start of the Easter holiday.</div><div> </div><div>Despite the sanctions on Iran, China's imports from the OPEC producer are set to rise from August as a Chinese state trader has signed a deal with the National Iranian Oil Company to buy more condensate.</div><div> </div><div>The world's top exporter Saudi Arabia kept output steady and cut its official selling prices (OSPs) sharply late last year in a fight for market share during a global supply glut.</div><div> </div><div>Its ability to raise prices for April and May suggests its strategy is working, although competition has kept its flagship Arab Light at a discount to Oman/Dubai quotes, analysts said.</div><div> </div><div>"There is still competition for the Asia market even though it is also a sign that some of the production elsewhere is less able to compete in the market right now," said Shunling Yap, a senior oil and gas analyst at BMI Research.</div><div> </div><div>On the supply front, the number of rigs drilling for oil in the United States declined by 11 last week to 802, the smallest drop since December, a weekly survey by oil service firm Baker Hughes showed on Thursday.</div><div> </div><div>Two weeks of small declines in the U.S. rig count have raised expectations that drilling activity is nearing a level that could dent output, bolster prices and coax rigs back to the field after a precipitous cull since October.</div><div> </div><div>(Reuters)</div>
