Singapore — Oil prices rose on Tuesday, supported by a weak dollar and expectations that the OPEC+ producer group would deepen and extend output cuts due to concerns over subdued demand.
Brent crude futures were up 57 cents, or 0.7%, to 80.55 a barrel at 0845 GMT, on track to snap a four-day losing streak. U.S. West Texas Intermediate (WTI) crude futures were 54 cents higher, also up 0.7%, at $75.40 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 Nov. 30 to discuss production targets for 2024.
The meeting comes amid a sharp decline in oil prices, due to concerns that the market was oversupplied despite OPEC+ output cuts. Brent has fallen by more than 18% and WTI by over 21% since end-September highs. Strong production by non-OPEC members such as the United States have added to price pressure.
OPEC+ sent oil prices tumbling last week by postponing its meeting in order to iron out disagreements over production targets for African producers. But it has moved towards a compromise, four OPEC+ sources told Reuters, potentially helping the group’s de facto leader Saudi Arabia find consensus.
The decline in prices could spare Riyadh any pressure from the U.S. to limit output cuts, according to analysts.
“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 Research said in a note on Tuesday.
The U.S. dollar’s retreat to its lowest level in three months should bolster demand from countries who pay for oil in other currencies.
*Sudarshan Varadhan; editing: Sonali Paul, Simon Cameron-Moore & Alexander Smith – Reuters
