Oil on track to snap losing streak on hopes of further OPEC+ cuts

Crude oil was up sharply in early trade amid reports that OPEC would reduce its output quotas.

Strong production by non-OPEC countries such as the United States has also added to pressure on prices. Image source | Reuters

Oil prices rose on Tuesday, snapping a multi-session losing streak ahead of a crucial meeting of OPEC+, which is widely expected to deepen and extend cuts to oil production amid fears of supply being consistently higher than demand.

Brent crude futures were up 45 cents, or 0.6 per cent, at $80.43 a barrel at 0152 GMT, on track to snap a four-day losing streak. U.S. West Texas Intermediate (WTI) crude futures were trading 43 cents higher, also 0.6 per cent, at $75.28 a barrel, after falling for three straight sessions.

OPEC+, which combines the Organization of the Petroleum Exporting Countries (OPEC) and allies including Russia, will hold an online ministerial meeting on November 30 to discuss production targets for 2024.

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"Crude oil was up sharply in early trade amid reports that OPEC would reduce its output quotas," ANZ Research said in a client note on Tuesday.

The group, whose move last week to postpone the meeting to iron out disagreements over production targets for African producers sent oil prices tumbling, has since moved closer to a compromise, four OPEC+ sources told Reuters on Friday, potentially helping de facto leader Saudi Arabia edge closer to consensus on deepening oil production cuts.

Strong production by non-OPEC countries such as the United States has also added to pressure on prices, analysts say.

"Saudi Arabia may be comforted that US gasoline prices have fallen for 60 straight days. This may soften the US opposition to any move to tighten oil markets and support prices," ANZ said.

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