Oil in London extended its gains near $62 a barrel after OPEC and its allies agreed on production cuts and protesters forced the shutdown of Libya’s biggest crude field.
Brent futures rose as much as 1.1 percent after jumping 2.7 percent on Friday as nations including Saudi and Russia committed to removing 1.2 million barrels a day of output, more than the market had expected.
Scepticism before a producer meeting in Vienna last week had seen money managers boost bets against crude.
Meanwhile, Libya’s largest oil field was halted after members of the Petroleum Facilities Guard shut down pumps leading to tanks.
Crude is paring this year’s losses after the Organization of Petroleum Exporting Countries and its partners defied U.S. President Donald Trump’s call for the producer group to keep taps open.
Prices have slid from a four-year high in early October highs after Washington gave temporary exemptions from sanctions to eight nations to continue purchasing Iranian oil, while America exacerbated a global glut by pumping at record levels.
“Some positives are coming to the table and the market is reacting to the potential of less supply in the short term,” said Stephen Innes, Singapore-based head of trading for Asia Pacific at Oanda Corp.
“Now, we make the all-important pivot to the April OPEC meeting and investors will be looking for evidence of how much of these cuts will be delivered.”
Brent for February settlement increased as much as 66 cents to $62.33 a barrel on London’s ICE Futures Europe exchange and traded 0.8 percent higher at $62.14 a barrel at 10:50 a.m. in Singapore. Futures rose $1.61 to $61.67 a barrel on Friday. The global benchmark crude traded at a $9.37 premium to U.S. West Texas Intermediate for the same month, the highest intraday level since Nov. 20.
WTI futures for January delivery were little changed and trading at $52.56 a barrel on the New York Mercantile Exchange. Prices rose 2.2 percent to $52.61 on Friday. Total volume traded was 54 percent above the 100-day average.For all the latest energy and oil news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.
Subscribe to Arabian Business' newsletter to receive the latest breaking news and business stories in Dubai,the UAE and the GCC straight to your inbox.