Oil prices rose more than 3% in early Asian trade on Monday as OPEC+ considers cutting production by up to 1 million barrels a day at a meeting this week to support the market.
Brent crude oil futures LCOc1 rallied $2.82, or 3.3%, to $87.96 a barrel by 2337 GMT after settling down 0.6% on Friday. US West Texas Intermediate Crude CLc1 was at $82.09 a barrel, up $2.60, or 3.3%, after losing 2.1% in the previous session.
Oil prices have fallen for four straight months since June as COVID-19 lockdowns in the biggest energy consumer China hurt demand, while rising interest rates and a strengthening US dollar weighed on global financial markets.
To prop up prices, the Organization of Petroleum Exporting Countries and its allies, a group known as OPEC+, are considering a 0.5 million to 1 million bpd production cut ahead of Wednesday’s meeting, OPEC+ sources told Reuters.
This will be the group’s second straight monthly cut after it reduced production by 100,000 bpd last month.
“Everything under 500 kb/d would be dismissed from the market. As such, we see a significant opportunity for a cut of up to 1 mb/d,” ANZ analysts said in a statement.
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